EverGen Infrastructure Corp. — Management Reports 2024

Apr 23, 2024

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Management’s Discussion and Analysis For the three months and year ended December 31, 2023

Dated April 22, 2024

EverGen Infrastructure Corp. Management’s Discussion and Analysis All amounts in Canadian $000s, unless otherwise indicated

FINANCIAL AND OPERATIONAL HIGHLIGHTS SUMMARY

Core Renewable Natural Gas (“RNG”) expansion and development projects: EverGen Infrastructure Corp. (“EverGen”, “the Company”, “we”, “our”, “us” or “its”) delivered two core RNG expansion and development projects during 2023 and continues to progress on its remaining core RNG expansion and development projects and regional expansion across Canada.

Fraser Valley Biogas (“FVB”)

During December 2023, EverGen announced the successful completion of the FVB core RNG expansion project and the delivery of first RNG. In March 2024, EverGen announced new record daily and monthly RNG production following the delivery of first RNG. This project commenced construction in Q3 2022, with a scope that included improvements to the feedstock processing system, installation of a new RNG upgrader, and the commissioning of a third anaerobic digestor. RNG production is expected to exceed initial expectations of ~160,000 gigajoules of RNG per year. The upgrades have removed processing bottlenecks, provided enhanced flood protection, improved environmental controls, and increased operational reliability to the facility. As at December 31, 2023, EverGen has invested approximately $12 million into this project before corporate overhead allocations and capitalized interest for an all-in cost of approximately $13 million .

Grow the Energy Circle Ltd. (“GrowTEC”)

In July 2022, EverGen completed the acquisition of a 67% interest in GrowTEC and subsequently entered into construction on the first phase of a core RNG expansion project designed to produce ~70,000 gigajoules of RNG per year. Construction and successful commissioning of this project was completed in Q1 2023. First injection of RNG occurred during Q2 2023 , following utility grid connection upon completion of gas quality sampling. In November 2023, GrowTEC announced that it had entered into a 10-year RNG offtake agreement with Irving Oil Ltd to supply up to 60,000 gigajoules of RNG per year, which provides for significant upside through revenue sharing opportunities. With the first phase of development complete, EverGen is moving into the second phase of the project. The second phase expands RNG capacity through the addition of preprocessing and depackaging equipment to broaden the range of organic waste the facility can process and is expected to increase production to ~140,000 gigajoules of RNG per year.

Prairie Sky Organics (“PSO”)

In September 2023, EverGen announced that it had entered into a 10-year agreement with the City of Regina to process all of the organic waste pursuant to the City’s Food and Yard Waste program, which is expected to provide up to 24,000 tonnes of organic waste annually. The agreement provides access to a new market, and an opportunity to consolidate various streams of available organic waste in the region that are currently being sent to landfill. PSO will accept waste at a temporary site at the City of Regina’s landfill, as potential permanent sites are being evaluated. In connection with the development of a permanent site, PSO secured a $7 million term loan to support the construction of an organics processing facility.

Pacific Coast Renewables (“PCR”)

The core RNG expansion project at Pacific Coast Renewables is expected to add RNG production of ~180,000 gigajoules per year. During the second quarter of 2023, EverGen was awarded funding of $10.5 million from Natural Resources Canada to support the development of the PCR core RNG expansion project and a contribution agreement was executed in February 2024. During 2023, EverGen completed upgrades to existing infrastructure, necessary to secure regulatory approvals and optimize the development and construction. The project is currently undergoing development and is expected

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EverGen Infrastructure Corp. Management’s Discussion and Analysis All amounts in Canadian $000s, unless otherwise indicated

to commence construction following the receipt of regulatory approvals. In November 2023, EverGen announced the renewed organic waste processing contract with the City of Abbotsford .

Project Radius

In May 2022, EverGen acquired a 50% interest in Project Radius , which is a late-development-stage portfolio of three high-quality, on-farm RNG projects in Ontario. Collectively the projects are capable of producing ~1.7 million gigajoules of RNG per year, with the first project expected to start construction during 2024.

Financing

In January 2023, EverGen signed a definitive agreement with its existing lender, Roynat Capital (a subsidiary of The Bank of Nova Scotia) (“Roynat”) and Export Development Canada (“EDC”) for a $31 million syndicated senior term loan (the “Term Loan Facility”). Roynat and EDC are each providing for 50% of the proceeds from the Term Loan Facility. The Term Loan Facility is being used to support the upgrade and construction of the Company’s RNG facilities and provided for $15 million for refinancing of existing debt and construction at FVB and $16 million at PCR. During the second quarter of 2023, EverGen made a drawdown of $9.5 million under the Term Loan Facility to finance the FVB core RNG expansion project. $16 million of the Term Loan Facility, related to the RNG construction at PCR, remains undrawn, until such time as the RNG project has commenced and certain conditions are met.

In September 2023, EverGen announced that it had signed a definitive agreement with Business Development Bank of Canada (“BDC”) for a $7 million term loan to support the construction of the PSO facility. EverGen expects to draw on the Facility once capital expenditures are incurred at the permanent site.

In January 2024, EverGen, through GrowTEC, signed a definitive agreement with Farm Credit Canada (“FCC”) for a $3.5 million term loan to support the expansion of the GrowTEC facility, including the procurement of depackaging equipment and front-end engineering and design work associated with the second phase of the core RNG expansion project. EverGen made a drawdown of $3.0 million under this facility in early-2024.

Leadership: In September 2023, EverGen announced that it had appointed Ford Nicholson as Interim Executive Chair, Mischa Zajtmann as Interim Chief Executive Officer and a Director of the Company, following the departure of Chase Edgelow. At the same time, Jamie Betts was appointed as Chief Operating Officer of the Company.

Cash and cash equivalents: Cash and cash equivalents decreased to $0.6 million as at December 31, 2023, compared to $8.9 million as at December 31, 2023, primarily due to capital expenditures related to the Company’s core RNG expansion and development projects.

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EverGen Infrastructure Corp. Management’s Discussion and Analysis All amounts in Canadian $000s, unless otherwise indicated

		Three months ended	Three months ended			Year ended	Year ended
	Dec 31, 2023	Dec 31, 2022	$ Change	% Change	Dec 31, 2023	Dec 31, 2022	$ Change	% Change
FINANCIAL Revenue Net loss Net loss per share ($), basic and diluted EBITDA(1) Adjusted EBITDA(1) Capital expenditures Total assets Total long-term liabilities Cash and cash equivalents Working capital surplus (deficit) (1)	2,314 (1,765) (0.12) (705) (9) 2,743 93,534 28,001 585 (3,558)	1,716 (1,526) (0.11) (914) 274 3,723 85,956 17,463 8,852 6,125	598 (239) (0.01) 209 (283) (980) 7,578 10,538 (8,267) (9,683)	35 16 8 (23) (103) (26) 9 60 (93) (158)	8,442 (4,743) (0.32) (1,720) 773 17,493 93,534 28,001 585 (3,558)	7,459 (4,110) (0.30) (1,067) 1,986 10,973 85,956 17,463 8,852 6,125	983 (633) (0.02) (653) (1,213) 6,520 7,578 10,538 (8,267) (9,683)	13 15 7 61 (61) 59 9 60 (93) (158)
COMMON SHARES (thousands) Outstanding, end of period Weighted average – basic & diluted	13,897 13,890	13,809 13,847	88 43	1 -	13,897 13,852	13,809 13,593	88 259	1 2
OPERATING Incoming organic feedstock (tonnes) Organic compost and soil sales (yards) RNG (gigajoules) Electricity (MWh)	22,768 4,763 22,926 669	16,972 6,575 10,847 572	5,796 (1,812) 12,079 97	34 (28) 111 17	80,608 27,066 62,891 3,116	76,730 33,972 51,848 1,270	3,878 (6,906) 11,043 1,846	5 (20) 21 145
(1) Non-GAAP measure as defined in the Non-GAAP mea			sures section of this MD&A.

Revenue: For the three months and year ended December 31, 2023, revenues increased 35% and 13%, respectively, compared to the same periods last year, primarily due to the commencement of RNG production at the GrowTEC RNG facility in late Q2-2023 and the commencement of operations at the PSO Organic waste and composting facility in late Q3-2023.

Net loss: For the three months and year ended December 31, 2023, net loss of $1,765 and $4,743 increased, compared to the same periods last year, mainly due to a decrease in insurance proceeds recognized for the year ended December 31, 2023, severance costs incurred (included in general and administrative expenses), an increase in finance costs due to an increase in interest rates and new leases entered into, and a loss on write-down of assets recognized in Q4-2023, partially offset by an increase in revenues, as described above, a decrease of a contingent consideration loss due to the timing of remeasurements of a liabilities associated with historical acquisitions, and an increase in income tax recovery.

Adjusted EBITDA: For the three months ended December 31, 2023, EverGen recorded adjusted EBITDA of ($9). The decrease in adjusted EBITDA was primarily due to a decrease in earnings at the FVB facility during the commissioning of the core RNG expansion project during Q4-2023, partially offset by an increase in revenues, as described above.

For the year ended December 31, 2023, EverGen recorded adjusted EBITDA of $773. The decrease in adjusted EBITDA was primarily due to a decrease in earnings at the FVB facility during the construction and commissioning of the core RNG expansion project, which was completed during late Q4-2023, and a decrease in insurance proceeds recognized, partially offset by an increase in revenues, as described above.

RNG Volumes: RNG production has increased during the three months and year ended December 31, 2023, compared to the same periods last year, following the first injection of RNG at GrowTEC in late Q2 2023. RNG production at FVB was impacted by commissioning of the core RNG expansion project during Q4 2023. Delivery of first RNG at the FVB RNG expansion project occurred in December 2023 and in March

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EverGen Infrastructure Corp. Management’s Discussion and Analysis All amounts in Canadian $000s, unless otherwise indicated

2024, EverGen announced a new daily and monthly RNG production record at the facility of 450 gigajoules in a day and 9,716 gigajoules for February 2024.

BASIS OF PRESENTATION

EverGen has prepared this Management’s Discussion and Analysis (“MD&A”) for the three months and year ended December 31, 2023, as at April 22, 2024, in accordance with National Instrument 51-102F1, and should be read in conjunction with the Company’s audited consolidated financial statements for the year ended December 31, 2023, which have been prepared in accordance with International Financial Reporting Standards as issued by the International Accounting Standards Board (“IFRS Accounting Standards”). All references to “$” are references to Canadian dollars and all amounts are presented in thousands of dollars, unless otherwise indicated. This MD&A and the audited consolidated financial statements of EverGen have been prepared by management and approved by the Audit Committee of the Board of Directors as of April 22, 2024.

Additional information relating to the Company, including our Annual Information Form (“AIF”) dated April 22, 2024, is available on SEDAR+ at www.sedarplus.ca. The Company’s common shares trade on the TSX Venture Exchange (“TSXV”) under the symbol “EVGN” and the OTCQX Market (“OTCQX”) under the symbol “EVGIF”.

READER ADVISORIES

This MD&A contains certain “forward-looking statements” within the meaning of Canadian securities legislation and introduces financial measures which are not defined under IFRS Accounting Standards 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.

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EverGen Infrastructure Corp. Management’s Discussion and Analysis All amounts in Canadian $000s, unless otherwise indicated

COMPANY OVERVIEW

EverGen, headquartered in Vancouver, British Columbia, is a sustainable infrastructure platform established to acquire, develop, build, own, operate, and consolidate a portfolio of RNG, waste to energy, and related infrastructure projects in Canada and North America.

EverGen commenced operations upon incorporation under the laws of British Columbia, Canada, on May 13, 2020.

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EverGen currently owns and operates five facilities through its subsidiaries: PCR, Sea to Sky Soils and Composting Inc. (“SSS”), PSO, FVB and GrowTEC, and holds a 50% interest in Project Radius, an entity that holds a portfolio of three RNG projects under development in Canada.

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EverGen Infrastructure Corp. Management’s Discussion and Analysis All amounts in Canadian $000s, unless otherwise indicated

FVB is British Columbia’s first RNG facility, which has historically sold its RNG under a long-term offtake contract with FortisBC and combines anaerobic digestion and biogas upgrading to produce RNG, primarily by converting agricultural waste from local dairy farms. In advance of finalizing the terms under a new longterm offtake agreement with FortisBC, replacing a vintage contract with FortisBC’s current terms, the facility is currently operating under an interim offtake contract. In December 2023, the core RNG expansion project at FVB was completed, which added additional RNG production capacity to the facility and is expected exceed ~160,000 gigajoules per year, more than doubling RNG production from ~80,000 gigajoules per year. Following the completion of the project, the FVB facility has been producing daily volumes of up to 450 gigajoules.

PCR and SSS, based in British Columbia, and PSO, based in Regina, are currently operating as organic waste conversion facilities, which process inbound organics, yard waste and biosolids for a contracted tipping fee and produce high-quality organic compost and soils for farmers, gardeners and developers. PCR is undergoing a planned core RNG expansion project, which will add anaerobic digestion capabilities to produce biogas and will then be upgraded to RNG to feed into FortisBC’s gas network under an existing 20-year off-take agreement. The expansion is expected to produce ~180,000 gigajoules of RNG per year. Construction of the upgrade will begin upon receipt of building and regulatory approvals, which applications were submitted during 2023. During the fourth quarter of 2022, EverGen commenced construction on improvements to the existing infrastructure to ensure the readiness of the facility for increased volumes of inbound organics, which was completed during Q1 2023. During the second quarter of 2023, EverGen was awarded funding of $10.5 million from Natural Resources Canada to support the development of the core RNG expansion project at PCR and the contribution agreement was executed in February 2024. The majority of the revenue currently earned by the organic waste conversion facilities is sourced under longterm contracts with local municipalities and in November 2023 EverGen announced the renewed organic waste processing contract with the City of Abbotsford.

GrowTEC is an operating biogas facility located in Lethbridge, Alberta. Following the acquisition of a 67% interest in the facility in Q3 2022, EverGen oversaw the installation of an RNG upgrader, and related equipment, required to upgrade biogas to produce RNG. The first phase of development was constructed and commissioned during the first quarter of 2023 and is expected to produce 70,000 gigajoules of RNG annually. Following utility grid connection upon the completion of gas quality sampling, the facility began injecting RNG during the second quarter of 2023 and has been producing daily volumes of up to 220 gigajoules. With the first phase of development complete, EverGen expects to move into the second phase of the project. The project expands RNG capacity through the addition of preprocessing and depackaging equipment, to broaden the range of organic waste the facility can process, and is expected to increase production capacity to ~140,000 gigajoules of RNG per year.

In May 2022, EverGen acquired a 50% interest in Project Radius, a late-development stage portfolio of three high-quality, on-farm RNG projects, each capable of producing approximately 550,000 gigajoules of RNG per year and are expected to be constructed from 2024 through 2026. EverGen is currently working with its partner on developing Project Radius to advance the projects to the notice-to-proceed phase of development.

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EverGen Infrastructure Corp. Management’s Discussion and Analysis All amounts in Canadian $000s, unless otherwise indicated

COMMERCIAL STRATEGY

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EverGen was formed to acquire and develop existing underutilized RNG infrastructure, convert existing organic waste facilities into RNG infrastructure and build and operate new RNG infrastructure. From its existing platform, EverGen plans to further grow and develop RNG projects in its growth pipeline and provide RNG under long-term offtake contracts to FortisBC and other investment grade customers.

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

• Completing the development and construction of EverGen’s existing portfolio of core RNG expansion projects;

• Optimizing, diversifying and expanding existing organic waste processing capabilities;

• Continuing the growth of EverGen’s project portfolio via strategic acquisitions and consolidation opportunities; and

• Developing strategic partnerships and advancing the RNG project pipeline.

OUTLOOK

During 2023, we successfully continued the expansion of our portfolio through the development of our core RNG expansion and development projects, as described above, which demonstrates EverGen’s ability to execute on projects and drive the consolidation and the growth of the RNG industry, as we continue to expand our geographical base. EverGen plans continued growth through the pursuit of RNG consolidation opportunities across North America and the further development of projects within its pipeline. This is driven by underlying investments in sustainable operations that contribute to carbon-negative energy production, and positively impact climate change initiatives.

EverGen’s growth, and increased financial performance, relies on the execution of its strategy to acquire, develop, build, own, operate and consolidate a portfolio of RNG, waste to energy and related sustainable infrastructure projects, including:

• Continuing development and construction of EverGen’s existing portfolio of core RNG expansion projects;

• Optimizing and expanding existing organic waste processing facilities and RNG feedstock;

• Securing and optimizing long-term contracts for RNG offtake and feedstock to provide stable longterm low-risk cash flows;

• Securing municipal feedstock agreements through developed partnerships and vertically integrated operations;

• Diversifying feedstock suppliers to de-risk inbound revenue streams;

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EverGen Infrastructure Corp. Management’s Discussion and Analysis All amounts in Canadian $000s, unless otherwise indicated

• Integrating talent, systems and processes across our projects to create efficiencies and best-inclass operations; and

• Continuing the growth of the project portfolio via the development of our project pipeline through strategic acquisitions and consolidation opportunities.

During 2024, EverGen expects to continue to develop its core RNG expansion and development projects through maximizing the production capacity of FVB and reaching final investment decisions at PCR, the second phase of GrowTEC, and Project Radius, as well as continue to develop and grow our project portfolio.

We believe that EverGen is uniquely positioned to capitalize on expansion prospects in the RNG market and that the RNG industry is set to grow rapidly over the next several decades based on increased availability of feedstock through population growth and landfill diversion measures, and increased customer demand for lower carbon energy alternatives. We believe that there is growing societal expectations of carbon neutral and circular economy solutions and increasing government support for these initiatives.

Executing strategic and accretive acquisitions

EverGen’s ability to identify and develop projects in our project pipeline, and then execute and integrate these projects as accretive acquisitions into EverGen’s platform is a key driver of our growth. Our growth is focused on realizing consolidation opportunities and achieving synergies in cost and margins through the operation and expansion of facilities under a unified business platform. The identification and development of projects, followed by the execution of acquisitions and consolidation opportunities, as well as their integration into a common operating platform with shared services and efficiency optimizations, is a key factor to our success. The successful execution and integration of acquisitions creates further opportunities within the market to EverGen, provides us with additional growth opportunities and drives further procurement and cost synergies across our operations.

1 Source: Biogas World

Driving cost efficiencies

Our high-value services and high-quality products through strategically located facilities provide a foundation to continue to identify and develop projects in our pipeline, consolidate growth and realize operational and capital efficiencies. To do so, we have been investing in a scalable platform and capabilities. This investment is the basis to realize future operational and capital efficiencies and further enhance our competitive position on top of our existing strong competitive position currently supported by asset management discipline, investment in sustainable infrastructure and collaborative stakeholder relationships. EverGen’s continued success depends upon 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.

Building collaborations

EverGen’s collaborative approach accelerates 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 leverages our capabilities in sourcing new organic waste streams and

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EverGen Infrastructure Corp. Management’s Discussion and Analysis All amounts in Canadian $000s, unless otherwise indicated

extending our business model to fulfill societal and customer expectations of waste recycling and waste to energy production combined with reduced greenhouse gas emissions.

ENVIRONMENTAL, SOCIAL AND GOVERNANCE (“ESG")

Our strategy is intertwined with our commitment to deliver on societal 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 delivers on its ESG values as follows:

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EverGen Infrastructure Corp. Management’s Discussion and Analysis All amounts in Canadian $000s, unless otherwise indicated

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EverGen is proactively engaged with local businesses, such as restaurants and food and beverage producers and distributors, to advance socially conscious commerce and creates mutually beneficial and socially responsible alternatives to traditional waste disposal to achieve a reduced carbon footprint. These potential new relationships represent a significant area of growth and diversification from EverGen’s existing customer base and provides the opportunity for market expansion while fulfilling society’s expectations of directing organic waste for recycling and the production of renewable energy.

For full details on EverGen’s ESG values and reporting, please refer to the Company’s AIF dated April 22, 2024 (see section entitled “Social/Environmental Policies”), which is available on SEDAR+ at www.sedarplus.ca.

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EverGen Infrastructure Corp. Management’s Discussion and Analysis All amounts in Canadian $000s, unless otherwise indicated

RESULTS OF OPERATIONS

Revenue

Revenue is generated primarily through contracted tipping fees charged to municipalities and other customers for the disposal of organic waste at EverGen’s facilities, from the sale of high-quality organic compost and soils, from RNG sales and from hauling services associated with delivering organic waste and soil. From July 13, 2022, revenue also includes electricity sales by GrowTEC.

The majority of tipping fees are included in EverGen’s organic waste and composting operating segment, with only a nominal amount included in the RNG production operating segment. Organic compost sales and soil sales, as well as trucking services and other, are all attributable to EverGen’s organic waste and composting operating segment. RNG and electricity sales are all attributable to EverGen’s RNG production operating segment. The Company’s revenue is exposed to fluctuations because of the inherent seasonality of organic waste processing and the sale of organic compost and soil, which is typically lower during winter months.

Revenue by source:

	Three months ended	Three months ended	Three months ended		Year ended
	Dec 31, 2023	Dec 31, 2022	% Change	Dec 31, 2023	Dec 31, 2022	% Change
Tipping fees Organic compost and soil sales RNG sales Electricity sales Other	1,574 43 592 95 10	1,204 85 198 225 4	31 (49) 199 (58) 150	5,777 591 1,500 560 14	5,389 699 818 460 93	7 (15) 83 22 (85)
Total	2,314	1,716	35	8,442	7,459	13

Production volumes:

	Three months ended	Three months ended	Three months ended		Year ended
	Dec 31, 2023	Dec 31, 2022	% Change	Dec 31, 2023	Dec 31, 2022	% Change
Incoming organic feedstock (tonnes) Organic compost and soil sales (yards) RNG (gigajoules) Electricity (MWh)	22,768 4,763 22,926 669	16,972 6,575 10,847 572	34 (28) 111 17	80,608 27,066 62,891 3,116	76,730 33,972 51,848 1,270	5 (20) 21 145

Revenues from tipping fees increased by $370, or 31%, and $388, or 7%, for the three months and year ended December 31, 2023, respectively, compared to the same periods last year, primarily due to increased volumes at all operating facilities, as well as the commencement of operation at PSO in September 2023.

Revenues from RNG production increased by $394, or 199%, and $682, or 83%, for the three months and year ended December 31, 2023, respectively, compared to the same periods last year, primarily due to the commencement of RNG production at GrowTEC in late Q2-2023 and increases in RNG pricing at FVB, partially offset by downtime during commissioning and construction associated with the FVB core RNG expansion project, which was completed in late-December 2023.

Revenue includes electricity sales from GrowTEC following the acquisition of a 67% interest of the company on July 13, 2022. Revenues from electricity sales decreased by $130, or 58%, for the three months ended December 31, 2023, compared to the same period last year, primarily due to a decrease in electricity prices.

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EverGen Infrastructure Corp. Management’s Discussion and Analysis All amounts in Canadian $000s, unless otherwise indicated

Revenue by segment:

	Three months ended	Three months ended	Three months ended		Year ended
	Dec 31, 2023	Dec 31, 2022	% Change	Dec 31, 2023	Dec 31, 2022	% Change
RNG production Organic waste and composting	762 1,552	491 1,225	55 27	2,334 6,108	1,570 5,889	49 4
Total	2,314	1,716	35	8,442	7,459	13

Direct operating costs

Direct operating costs are costs incurred to earn revenue and includes all attributable expenses, including labour, fuel charges, disposal costs, freight costs, hauling costs, the preparation and the processing of screening, blending and curing organic waste for conversion into saleable organic compost and soil, repairs and maintenance, equipment rental, insurance, utilities, licenses, permits and depreciation and amortization expenses. EverGen’s direct operating costs are exposed to fluctuations because of seasonal weather and the related fluctuations in volumes processed.

	Three months ended	Three months ended	Three months ended		Year ended
	Dec 31, 2023	Dec 31, 2022	% Change	Dec 31, 2023	Dec 31, 2022	% Change
Direct operatingcosts	2,695	2,350	15	9,906	9,952	-

Direct operating costs increased by $345, or 15%, for the three months ended December 31, 2023, compared to the same period last year, primarily due to the commencement of RNG production at GrowTEC in late Q2-2023 and depreciation and amortization associated with the acquisition of property, plant and equipment and right-of-use assets during late-2022 through Q4-2023. Direct operating costs for the year ended December 31, 2023 were consistent with last year due to an increase in depreciation and amortization expense which was offset by lower repairs & maintenance costs.

General and administrative expenses

General and administrative expenses consist primarily of head office personnel costs, share-based payment expense, professional and consulting fees and other general and administrative expenses.

	Three months ended	Three months ended	Three months ended	Year ended	Year ended
	Dec 31, 2023	Dec 31, 2022	% Change	Dec 31, 2023	Dec 31, 2022	% Change
General and administrative expenses	1,528	1,397	9	5,092	4,629	10

General and administrative expenses increased by $131, or 9%, for the three months ended December 31, 2023, compared to the same period last year, primarily due to an increase in legal fees associated with a dispute with the vendors regarding the contingent consideration relating to the acquisition of SSS and an increase in consulting and legal fees associated with severance costs.

General and administrative expenses increased by $463, or 10%, for the year ended December 31, 2023, compared to last year, primarily due to an increase in share-based payment expense in the year relative to the forfeiture of certain equity securities during 2022 and an increase in severance costs, partially offset by a decrease business development and consulting fees mainly due to the internal transfer of previously outsourced services.

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EverGen Infrastructure Corp. Management’s Discussion and Analysis All amounts in Canadian $000s, unless otherwise indicated

Finance costs

EverGen’s finance costs primarily relate to interest expense recognized on loans payable, which were used to finance growth in the Company’s asset base, and the associated interest expense on lease liabilities.

	Three months ended	Three months ended	Three months ended		Year ended
	Dec 31, 2023	Dec 31, 2022	% Change	Dec 31, 2023	Dec 31, 2022	% Change
Interest expense on loans payable Interest expense on loans payable - related parties Interest expense on lease liabilities Other	371 7 149 109	113 - 82 (11)	228 100 82 (1,091)	977 22 521 148	346 - 266 (16)	182 100 96 (1,025)
Less: capitalized interest	636 (264)	184 -	246 100	1,668 (602)	596 -	180 100
Total	372	184	102	1,066	596	79

Finance costs increased by $188, or 102%, and $470, or 79%, for the three months and year ended December 31, 2023, respectively, compared to the same periods last year, primarily due to an increase in interest rates and new leases entered into during 2023 and late-2022 to support business growth.

Contingent consideration (loss) gain

		Three	months ended	months ended	Year ended	Year ended
	Dec 31, 2023		Dec 31, 2022	% Change	Dec 31, 2023	Dec 31, 2022	% Change
Contingent consideration (loss) gain	(17)		(310)	(95)	73	(400)	(118)

A contingent consideration gain of $73 was recognized during the year ended December 31, 2023, compared with a loss of $400 last year, as a result of adjustments of the liability relating to amounts payable in connection with the acquisition of GrowTEC, taking into account estimated holdbacks, and a reassessment of the liability associated with the SSS acquisition following the ongoing proceedings of a dispute related to working capital adjustments.

Other income – net

	Three months ended	Three months ended	Three months ended		Year ended
	Dec 31, 2023	Dec 31, 2022	% Change	Dec 31, 2023	Dec 31, 2022	% Change
Insurance proceeds Carbon credits and other	782 30	655 (14)	19 (314)	1,228 586	3,120 286	(61) 105
Total	812	641	27	1,814	3,406	(47)

Other income - net increased during the three months December 31, 2023, compared to the same period last year, primarily due to an increase in the recognition of insurance proceeds. Other income – net decreased for the year ended December 31, 2023, compared to prior year, primarily due to a decrease in the recognition of insurance proceeds relating to flood-related expenditures incurred due to the flooding events in the Abbotsford and Sumas Prairie regions during late-2021.

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EverGen Infrastructure Corp. Management’s Discussion and Analysis All amounts in Canadian $000s, unless otherwise indicated

Income taxes

Income taxes consist of current and deferred income taxes.

		Three	months ended	months ended	Year ended	Year ended
	Dec 31, 2023		Dec 31, 2022	% Change	Dec 31, 2023	Dec 31, 2022	% Change
Current tax expense (recovery) Deferred tax expense(recovery)	(18) (307)		- (442)	100 (31)	- (1,677)	4 (744)	(100) 125
Total	(325)		(442)	(26)	(1,677)	(740)	127

The increase in income tax recovery for the year ended December 31, 2023, compared to the same period last year, is primarily due to an increase in net loss.

EBITDA and Adjusted EBITDA[(1)]

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 (“EBITDA”). Adjusted EBITDA is measured as EBITDA adjusted for share-based payment expense, certain non-cash items and unusual or non-recurring items. EBITDA and adjusted EBITDA are non-GAAP measures as defined in the non-GAAP measures section of this MD&A.

		Three months ended	Three months ended	Three months ended	Year ended	Year ended
	Dec 31, 2023		Dec 31, 2022	% Change	Dec 31, 2023	Dec 31, 2022	% Change
Net loss Tax (recovery) Depreciation and amortization Finance costs	(1,765) (325) 1,013 372		(1,526) (442) 870 184	16 (26) 16 102	(4,743) (1,677) 3,634 1,066	(4,110) (740) 3,187 596	15 127 14 79
EBITDA(1)	(705)		(914)	(23)	(1,720)	(1,067)	61
Share-based payment expense Loss on sale of equipment Non-recurring general and administrative expenses and other Contingent consideration loss (gain) Non-recurring general and administrative expenses and other related to equity- accounted investment Loss on write-down of assets	80 - (28) 17 11 581		121 51 597 310 46 -	(34) (100) (105) (95) (76) 100	641 - 1,208 (73) 61 581	433 96 2,012 400 85 -	48 (100) (40) (118) (28) 100
Consolidated adjusted EBITDA(1)	(44)		211	(121)	698	1,959	(64)
Adjusted EBITDA attributable to non-controllinginterest	35		63	(44)	75	27	178
Adjusted EBITDA(1)	(9)		274	(103)	773	1,986	(61)

(1) Non-GAAP measure as defined in the Non-GAAP measures section of this MD&A.

EverGen’s EBITDA of ($705) increased for the three months ended December 31, 2023, compared to the same period last year, primarily due to an increase in revenues, as described above, and a decrease in contingent consideration loss, partially offset by a loss on write-down of assets recognized during the three months ended December 31, 2023 and an increase in general and administrative expenses, as described above.

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EverGen Infrastructure Corp. Management’s Discussion and Analysis All amounts in Canadian $000s, unless otherwise indicated

EverGen’s Adjusted EBITDA of ($9) decreased for the three months ended December 31, 2023, compared to the same period last year, primarily due to a decrease in earnings at the FVB facility during the commissioning of the core RNG expansion project during Q4-2023, an increase of certain legal fees included in general and administrative costs, partially offset by an increase in revenues, as described above.

EverGen’s EBITDA of ($1,720) decreased for the year ended December 31, 2023, compared to last year, primarily due to a decrease in insurance proceeds and an increase in general and administrative expenses, as described above, partially offset by an increase in revenues and other income and a decrease in contingent consideration loss.

EverGen’s Adjusted EBITDA of $773 decreased for the year ended December 31, 2023, compared to last year, primarily due to a decrease in earnings at the FVB facility during the construction and commissioning of the core RNG expansion project, which was completed during late Q4-2023, and a decrease in insurance proceeds partially offset by an increase in revenues, as described above.

CAPITAL EXPENDITURES

Capital expenditures include purchases of property, plant and equipment used for operations as well as acquisitions.

	Three months ended	Three months ended	Three months ended	Year ended	Year ended
	Dec 31, 2023	Dec 31, 2022	% Change	Dec 31, 2023	Dec 31, 2022	% Change
Capital expenditures – property plant and equipment Capital expenditures – acquisitions	2,743 -	3,473 250	(21) (100)	16,477 1,016	7,669 3,304	115 (69)
Total	2,743	3,723	(26)	17,493	10,973	59

Capital expenditures – property, plant and equipment during the three months and year ended December 31, 2023 and 2022, related primarily to the Company’s core RNG expansion projects at FVB, PCR and GrowTEC, as well as existing infrastructure capital improvements at PCR.

Capital expenditures – acquisitions during the year ended December 31, 2023 related to a contingent consideration payment made in relation to the Company’s acquisition of a 67 percent interest in GrowTEC.

Capital expenditures - acquisitions during the three months ended December 31, 2022, includes a capital contribution to Project Radius. Capital acquisitions for the year ended December 31, 2022, includes the Company’s acquisition of a 67% interest in GrowTEC and $1,250 of equity investment into Project Radius.

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EverGen Infrastructure Corp. Management’s Discussion and Analysis All amounts in Canadian $000s, unless otherwise indicated

SELECTED ANNUAL FINANCIAL INFORMATION

		Year ended
	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021
FINANCIAL Revenue Net loss Net loss per share ($), basic and diluted EBITDA(1) Adjusted EBITDA(1) Capital expenditures Total assets Total long-term liabilities Cash and cash equivalents Workingcapital surplus(deficit)	8,442 (4,743) (0.32) (1,720) 773 17,493 93,534 28,001 585 (3,558)	7,459 (4,110) (0.30) (1,067) 1,986 10,973 85,956 17,463 8,852 6,125	9,564 (1,953) (0.18) 836 2,839 12,234 80,610 14,764 19,597 20,545
COMMON SHARES (thousands) Outstanding, end of period Weighted average – basic & diluted	13,897 13,852	13,809 13,593	13,367 11,029
OPERATING Incoming organic feedstock (tonnes) Organic compost and soil sales (yards) RNG (gigajoules) Electricity (MWh)	80,608 27,066 62,891 3,116	76,760 33,972 51,484 1,270	94,206 61,790 55,380 -
(1) Non-GAAP measure as defined in the Non-GAAP measures section of this MD&A.

Following its formation in 2020, EverGen has been executing on its corporate strategy to acquire and develop existing underutilized RNG infrastructure, convert existing organic waste facilities into RNG infrastructure and build and operate new RNG infrastructure. On December 31, 2020, EverGen acquired PCR and SSS. On April 16, 2021, EverGen acquired FVB and on July 13, 2022, EverGen acquired GrowTEC. EverGen completed the FVB core RNG expansion project on December 21, 2023. EverGen’s total assets have increased as a result of these acquisitions and through investing capital into core RNG expansion projects resulting in a decrease in cash and cash equivalents, as well as working capital, while these projects were under construction.

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EverGen Infrastructure Corp. Management’s Discussion and Analysis All amounts in Canadian $000s, unless otherwise indicated

SUPPLEMENTAL QUARTERLY INFORMATION

		2023	2023			2022	2022
	Dec 31	Sep 30	June 30	Mar 31	Dec 31	Sep 30	June 30	Mar 31
	Q4	Q3	Q2	Q1	Q4	Q3	Q2	Q1
FINANCIAL
Revenue	2,314	2,287	2,158	1,683	1,716	1,957	2,359	1,427
Net (loss) income	(1,765)	(1,091)	(891)	(996)	(1,526)	(1,819)	(546)	(219)
Net (loss) income per share ($),
basic and diluted	(0.12)	(0.08)	(0.06)	(0.07)	(0.11)	(0.13)	(0.04)	(0.02)
EBITDA(1)	(705)	(440)	(387)	(188)	(914)	(486)	(154)	481
Adjusted EBITDA(1)	(9)	382	382	18	274	650	426	631
Capital expenditures – property,
plant and equipment	2,743	5,583	2,841	5,310	3,473	1,492	1,349	1,355
Capital expenditures – acquisitions	-	1,016	-	-	250	2,054	1,000	-
Total assets	93,534	92,280	94,814	88,216	85,956	85,692	78,581	79,771
Total long-term liabilities	28,001	27,640	28,214	18,749	17,463	17,462	14,453	14,522
Workingcapital surplus (deficit)(1)	(3,558)	325	6,997	1,143	6,125	10,079	16,524	19,196
COMMON SHARES (thousands)
Outstanding, end of period	13,897	13,885	13,845	13,845	13,809	13,872	13,307	13,367
Weighted average – basic & diluted	13,890	13,851	13,845	13,820	13,847	13,794	13,357	13,367
OPERATING
Incoming organic feedstock
(tonnes)	22,768	18,983	20,955	17,902	16,972	19,375	24,336	16,047
Organic compost and soil sales
(yards)	4,763	10,425	10,365	894	6,575	8,219	13,778	5,400
RNG sales (gigajoules)	22,926	24,657	6,442	8.866	10,847	14,975	20,254	5,772(2)
Electricity(MWh)	669	717	920	810	572	698	-	-

(1) Non-GAAP measure as defined in the Non-GAAP measures section of this MD&A.

(2) Reduced as a result of flooding events that occurred in Q4 2021.

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. As a result, the Company typically sees higher revenues, net income, EBITDA and Adjusted EBITDA during Q2 and Q3 of a given year, when compared to Q1 and Q4, due to higher incoming organic feedstock and organic compost and soil sales during these periods.

During Q4 of 2021, certain of EverGen’s operating facilities were impacted by severe flooding, which impacted the FVB RNG facility and was not operational during periods in Q1 2022. During Q4 2022 and Q1 through Q4 of 2023, FVB RNG production volumes were impacted from planned downtime, with the facility being offline as part of the core RNG expansion project, and unplanned downtime due to equipment availability and installation.

EverGen is committed to the expansion of its operations through the development of its existing portfolio and the optimization and development of existing organic waste processing facilities and RNG production facilities. The Company has been investing in its core RNG expansion projects since mid-2021.

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18

EverGen Infrastructure Corp. Management’s Discussion and Analysis All amounts in Canadian $000s, unless otherwise indicated

LIQUIDITY AND CAPITAL RESOURCES

	December 31, 2023	December 31, 2022	% Change
Cash and cash equivalents Workingcapital surplus(deficit) (1)	585 (3,558)	8,852 6,125	(93) (158)

(1) Non-GAAP measure as defined in the Non-GAAP measures section of this MD&A.

We consider our capital to consist of shareholders’ equity, debt, including lease liabilities, less cash and cash equivalents. The Company’s objective when managing capital is to maintain adequate levels of funding to support the growth and development of its business and maintain the necessary corporate and administrative functions to facilitate these activities. 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 adjust its capital structure. 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 metrics are key measures of liquidity and the management of capital resources.

EverGen’s cash and cash equivalents and working capital surplus decreased as at December 31, 2023, compared to December 31, 2022, and at as December 31, 2023 EverGen had a working capital deficit primarily due to the delayed commencement of RNG production at Grow the Energy Circle Ltd. along with greater than expected capital costs associated with the RNG expansion at Fraser Valley Biogas Ltd. EverGen expects that it will need to obtain additional sources of financing, in addition to amounts generated from operations, to meet its obligations and commitments and minimum liquidity requirements under its financial covenants. Additional potential sources of financing that the Company is actively pursuing or may consider pursuing, include: entering into new debt facilities, borrowing additional amounts under existing facilities, the refinancing or extension of certain borrowings, selling certain assets and seeking joint venture partners for the Company’s business interests. EverGen is actively pursuing or may pursue the financing initiatives described above, certain of which have been completed as described below, and others which it considers probable of completion based on the Company’s assessment of current conditions and estimated future conditions. The Company is in various stages of progression on these matters. As at December 31, 2023, EverGen was committed to $3.5 million of future capital expenditure, primarily related to the core RNG expansion project at PCR. These commitments are expected to be funded by existing liquidity, expected future operating cash flows and additional sources of financing.

As at December 31, 2023 EverGen was not in compliance with certain of its covenant requirements under a syndicated term loan and obtained a waiver from the lenders, as at that date, for limited suspension of the covenant compliance requirements under the facility.

In January 2023, EverGen announced that it had entered into an agreement for a $31 million syndicated senior term loan, which provides sufficient funding for the Company’s planned core RNG expansion projects, when combined with the Company’s existing liquidity, grant proceeds and expected future operating cash flows. During the year ended December 31, 2023, EverGen made a drawdown of $9,475 under this term loan agreement.

In January 2024, the Company executed a debt-to-equity conversion with the minority shareholders of GrowTEC.

In January 2024, GrowTEC signed a definitive agreement with Farm Credit Canada (“FCC”) for a $3.5 million term loan to support the expansion of the GrowTEC facility, including the procurement of depackaging equipment and front-end engineering and design work associated with the second phase of

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19

EverGen Infrastructure Corp. Management’s Discussion and Analysis All amounts in Canadian $000s, unless otherwise indicated

the core RNG expansion project. EverGen made a drawdown of $3.0 million under this facility in early2024.

Share capital

The Company had the following outstanding common shares and equity instruments as at December 31, 2023, and December 31, 2022:

(thousands)	December 31, 2023	December 31, 2022	% Change
Common shares Share warrants Options Performance share units Restricted share units Deferred share units	13,897 - 335 430 214 28	13,809 1,772 142 430 209 28	1 (100) 136 - 2 -
Total outstandingsecurities	14,904	16,390	(9)

A description of EverGen’s equity instruments can be found in note 15 to the consolidated financial statements for the year ended December 31, 2023.

As of the date of this MD&A, the following equity instruments were outstanding:

(thousands)
Common shares Options Performance share units Restricted share units Deferred share units	13,930 523 430 228 66
Total outstandingsecurities	15,177

Use of proceeds

On August 4, 2021, EverGen completed an initial public offering. As at December 31, 2023, the Company used the proceeds from the offering, compared to the intended use of the proceeds, as follows:

	Intended use of netproceeds	Use of net proceeds as at December 31, 2023	% Change
Project development, construction and expansion Further development and acquisition activities	10,750 6,569	14,015 3,304	30 (50)
Total	17,319	17,319	-

EverGen used more proceeds than intended from the initial public offering for project development relating to the Company’s core RNG expansion projects at FVB, PCR and GrowTEC, which has no impact on the Company’s ability to continue to drive the consolidation and the growth of the RNG industry.

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20

EverGen Infrastructure Corp. Management’s Discussion and Analysis All amounts in Canadian $000s, unless otherwise indicated

Summary of Cash Flows

	Year ended	Year ended	%
	December 31, 2023	December 31, 2022	Change
Net operating cash flow Net investing cash flow Net financingcash flow	307 (16,657) 8,083	(751) (7,475) (2,519)	(141) 123 (421)
Total	(8,267)	(10,745)	(23)

The Company’s net operating cash flows increased for the year ended December 31, 2023, compared to last year, primarily due to an increase in revenues, as described above and the timing of changes in noncash working capital, partially offset by higher insurance proceeds received during the year ended December 31, 2022, relating to lost revenues and additional flood-related costs incurred at FVB and PCR.

EverGen has continued its focus on the investment into its facilities for the year ended December 31, 2023, with cash used in investing activities associated with property, plant and equipment expenditures relating to the Company’s core RNG expansion projects at GrowTEC, FVB and PCR. Pursuant to its core RNG expansion projects at the facilities, which upon completion are intended to significantly increase EverGen’s RNG production, net income and EBITDA, the Company is in the process of purchasing capital assets, including the capital assets purchased related to the completion of the FVB core RNG expansion project. Additionally, during the year ended December 31, 2023, a contingent consideration payment was made in relation to the Company’s acquisition of a 67% interest in GrowTEC and EverGen advanced a loan to Project Radius of $500, which is due and payable to EverGen on June 30, 2024.

Cash used in investing activities for the year ended December 31, 2022, relates to property, plant and equipment expenditures associated with the Company’s core RNG expansion projects at PCR and FVB and capital improvements at PCR. In addition, EverGen made a capital investment of $1,250 in Project Radius and completed the acquisition of 67% interest in GrowTEC for initial cash consideration of $2,054. These investments were partially offset by the release of restricted cash related to acquisition holdbacks.

Cash provided by financing activities for the year ended December 31,2023, increased compared to last year primarily due to the drawdown of the Term Loan Facility and advances from related parties during the year ended December 31,2023, partially offset by an increase in lease payments.

ACCOUNTING STANDARDS, CHANGES AND PRONOUNCEMENTS

The Company’s material accounting policies are included in Note 3 to the Company’s annual financial statements for the year ended December 31, 2023.

CRITICAL ACCOUNTING ESTIMATES, JUDGMENTS AND ASSUMPTIONS

The preparation of financial statements requires management to make certain judgments, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets, liabilities, revenues and expenses. Actual results may differ from those estimates as the estimation process is inherently uncertain. Estimates are reviewed on an ongoing basis based on historical experience and other factors that are considered to be relevant in the circumstances. Revisions to estimates and the resulting effects on the carrying amounts of the Company’s assets and liabilities are accounted for prospectively.

The Company’s uses of estimates, judgements and assumptions are included in Note 2 to the Company’s financial statements for the year ended December 31, 2023. There have been no significant changes to the Company’s critical accounting estimates, judgments and assumptions during the year ended December 31, 2023.

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21

EverGen Infrastructure Corp. Management’s Discussion and Analysis All amounts in Canadian $000s, unless otherwise indicated

MANAGEMENT’S REPORT ON INTERNAL CONTROLS

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.

We have designed disclosure controls and procedures, as defined in National Instrument 52-109 - Certification of Disclosure in Issuers’ Annual and Interim Filings (“NI 52-109”), to provide reasonable assurance that material information is identified and communicated to management, including the Chief Executive Officer and Chief Financial Officer, in a timely manner to allow decisions regarding required disclosures.

We have also designed internal controls over financial reporting (“ICFR”), as defined in NI 52-109, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with IFRS Accounting Standards.

A control system, including EverGen’s disclosure controls and procedures and ICFR, no matter how well designed, has inherent limitations and can only provide reasonable, not absolute, assurance that the objectives of the control system will be met, and it should not be expected that the disclosure controls and procedures and ICFR will prevent all misstatements and instances of fraud, if any.

During the year ended December 31, 2023 there were no changes in ICFR that have materially affected, or are reasonably likely to materially affect, the Company’s internal controls over financial reporting.

EverGen is not required to certify the design and evaluation of the issuer’s DC&P and ICFR and has not completed such an evaluation and inherent limitations on the ability of the certifying officers to design and implement on a cost-effective basis DC&P and ICFR for the issuer may result in additional risks to the quality, reliability, transparency and timeliness of interim and annual filings and other reports provided under securities legislation.

RELATED PARTY TRANSACTIONS

Key management compensation

The value of compensation and other fees paid to board of directors and members of executive management of EverGen is included in the table that follows. There were no fees paid to the board of directors of the Company during the three months and year ended December 31, 2023 and 2022.

		Three	months ended	months ended	Year ended	Year ended
	Dec 31, 2023		Dec 31, 2022	% Change	Dec 31, 2023	Dec 31, 2022	% Change
Salaries and benefits Share-basedpayment expense	213 84		174 108	22 (22)	1,039 568	534 348	95 63
Total	297		282	5	1,607	882	82

Other related party transactions

In July 2022, GrowTEC entered into a lease agreement with a related parties to lease the land on which the facility is located for a term of ten years, with the option to extend for an additional two five-year periods, at the option of the EverGen. The lease agreement is with entities which are the minority shareholders of GrowTEC. The lease payments for the initial term are $270 for the first year of the lease and $120 per year for the remaining nine years. During the three months and year ended December 31, 2023, the Company incurred lease expenses of $30 and $195, respectively, relating to this lease (year ended December 31, 2022- $67 and $135, respectively).

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EverGen Infrastructure Corp. Management’s Discussion and Analysis All amounts in Canadian $000s, unless otherwise indicated

Effective April 1, 2023, EverGen entered into a loan agreement with the non-controlling interest holders of GrowTEC to provide proceeds of $710 to fund the non-controlling interest holders proportionate share of capital expenditure. The loan is repayable over a five-year term and bears interest at a rate of 4.0%. Effective January 1, 2024, this loan was converted to equity within GrowTEC and will be treated as a contribution from non-controlling interests.

Effective December 1, 2023, EverGen entered into a loan agreement with the vendors related to the acquisition of GrowTEC to provide proceeds of $1,000 to primarily fund the repayment of amounts owing as contingent consideration related to the acquisition of the 67% interest in GrowTEC in July 2022. The full outstanding balance of the loan is repayable on January 1, 2025, and bears interest at a rate of 10.0%, which EverGen has the option to pay interest in cash, payment-in-kind, or a combination thereof.

OFF BALANCE SHEET ARRANGEMENTS

During the three months ended December 31, 2023, EverGen received a performance service guarantee from Export Development Canada to provide a guarantee on a $1,378 letter of credit issued in relation to GrowTEC, which allowed EverGen to release $1,378 of collateral previously held in relation to the letter of credit.

FINANCIAL INSTRUMENTS

As at December 31, 2023, the Company’s financial instruments consists of cash and cash equivalents, restricted cash, accounts receivable, accounts payable and accrued liabilities, lease liabilities, loans payable and loans payable – related parties.

RISKS AND UNCERTAINTIES

Risk is inherent in all business activities and cannot be entirely eliminated. EverGen’s business and financial performance, which includes our results of operations and cash flows, are impacted by a number of risks. We are also subject to the risks arising from adverse changes in global economic and political conditions. Political conditions such as government commitments and policies towards environmental protection and renewable energy may change over time. Economic conditions in leading and emerging economies have been, and remain, unpredictable.

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.

Financial risk management

The Company is exposed to market risk (i.e., interest rate risk, foreign currency risk and commodity risk), credit risk and liquidity risk. The following is a description of these risks and how they are managed:

Market risk

Market risk is defined for these purposes as the risk that the fair value or future cash flows of a financial instrument held by the Company will fluctuate because of changes in market prices. Market risk includes the risk of changes in interest rates, foreign currency exchange rates and changes in market prices due to factors other than interest rates or foreign currency exchange rates, such as changes in commodity prices or credit spreads.

Interest rate risk

Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market interest rates. The Company is exposed to the impact of interest rate

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23

EverGen Infrastructure Corp. Management’s Discussion and Analysis All amounts in Canadian $000s, unless otherwise indicated

changes, primarily through its floating-rate borrowings that require it to make interest payments based on the Canadian Variable Rate. Significant increases in interest rates could adversely affect operating margins, results of operations and the Company's ability to service its debt.

At December 31, 2023, the Company is exposed to interest rate risk with respect to its loans payable. A 50 basis points increase or decrease, respectively, in the Company’s interest rates is expected to increase or decrease finance costs for the year ended December 31, 2023 by $49 or $54, respectively.

Foreign exchange risk

Foreign currency risk is the risk that the fair value or future cash flows of an exposure will fluctuate because of changes in foreign exchange rates. The Company has very few transactions denominated in foreign currencies thereby minimizing risk associated with fluctuations in exchange rates. Credit risk

Credit risk is the risk of financial loss to the Company if a customer or counterparty to a financial instrument fails to meet its contractual obligations. The Company’s exposure to credit risk on customer accounts receivable is influenced mainly by the individual characteristics of each debtor and is concentrated with a few customers, primarily municipal governments and the Company is therefore able to monitor credit risk on an individual account basis and apply lifetime expected loss provisions where any uncertainty on collectability is identified.

The Company’s historical bad debt expense has not been significant and is usually limited to specific customer circumstances. The Company considers the credit worthiness of counterparties and past payment history as well as amounts past due.

The Company regularly monitors customers’ payments and considers all amounts greater than 60 days to be past due. As at December 31, 2023, the Company had $178 of contractual payments, included in accounts receivable, which are greater than 60 days past due. The maximum exposure to credit risk related to trade receivables is their carrying value as disclosed in these financial statements. Based on only insignificant amounts of historical bad debts, as well as minimal expectation of future losses as a result of default, the Company has determined its credit risk to be low.

The Company held cash and cash equivalents of $585 at December 31, 2023, which represents its maximum credit exposure on these assets (December 31, 2022 - $8,852 cash and cash equivalents and $20 restricted cash). The cash is held with major financial institution counterparties and management believes credit risk is minimal.

Liquidity risk

Liquidity risk is the risk that the Company will encounter difficulty in meeting the obligations associated with its financial liabilities that are settled by delivering cash or another financial asset. The Company’s approach to managing liquidity is to ensure that it will always have sufficient liquidity to meet its liabilities when due, under both normal and stressed conditions, without incurring unacceptable losses or risking damage to the Company's reputation. As at December 31, 2023, the Company had a working capital deficit, being current assets less current liabilities, of $3,558.

The Company's primary liquidity needs for the next twelve months are to pay existing committed capital expenditures, to make scheduled repayments of debt, to pay debt service costs, to pay direct operating costs, to fund general working capital requirements and to manage its working capital deficit.

See the Liquidity and Capital Resources section above for an assessment of EverGen’s ability to meet these obligations for at least the one-year period to December 31, 2024.

Other risks

The Company is also exposed to a number of other risks and uncertainties. For full details on the risks and uncertainties affecting EverGen, please refer to the Company’s AIF dated April 22, 2024 (see section entitled “Risk Factors”), which is available on SEDAR+ at www.sedarplus.ca. The risks and uncertainties described in our AIF are not the only ones that we face. Additional risks and uncertainties, including those

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24

EverGen Infrastructure Corp. Management’s Discussion and Analysis All amounts in Canadian $000s, unless otherwise indicated

that we do not currently know of or that we deem immaterial, could materially and adversely affect the Company’s investments, prospects, cash flows, results of operations or financial condition.

NON-GAAP MEASUREMENTS

EverGen uses certain financial measures referred to in this MD&A to quantify its results that are not prescribed by IFRS Accounting Standards. The following terms: “EBITDA”, “adjusted EBITDA”, and “working capital surplus (deficit)” are not recognized measures under IFRS Accounting Standards and may not be comparable to that reported by other companies. EverGen believes that, in addition to measures prepared in accordance with IFRS Accounting Standards, these 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 are 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 Accounting Standards.

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, unusual or non-recurring items, contingent consideration gains and losses, and noncontrolling interests in adjusted EBITDA. A reconciliation of the non-GAAP measures, EBITDA and adjusted EBITDA to the applicable IFRS Accounting Standards measure can be found under the Results of Operations section of this MD&A.

Working capital surplus (deficit)

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 Accounting Standards measurements for the Company:

(thousands)	December 31, 2023	December 31, 2022	% Change
Current assets Current liabilities	4,396 (7,954)	13,236 (7,111)	(67) 12
Workingcapital surplus(deficit)	(3,558)	6,125	(158)

FORWARD LOOKING STATEMENTS

This MD&A contains certain forward-looking statements and forward-looking information (collectively “forward-looking statements”) within the meaning of applicable Canadian securities laws that involve risks, uncertainties and assumptions and relate to the Company’s current expectations and views of future events. All statements other than statements of present or historical fact are forward-looking statements.

Forward-looking statements can often, but not always, be identified by the use of words such as “forecast”, “target”, “goal”, “may”, “might”, “will”, “expect”, “anticipate”, “estimate”, “intend”, “plan”, “indicate”, “seek”, “believe”, “project”, “predict”, or “likely”, or the negative of these terms, or other similar expressions intended to identify forward-looking statements. The Company has based these forward-looking statements on its current expectations and projections about future events and financial trends that it believes might affect its financial condition, results of operations, business strategy and financial needs. In particular, this MD&A contains forward-looking statements including, but not limited to:

• The timing of the completion of the Company’s core RNG expansion projects, as well as the expected capital costs, RNG production and inbound organic feedstock capacity;

• EverGen’s plans to grow and develop RNG facilities and construct a platform of sustainable infrastructure and reduce carbon emissions;

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EverGen Infrastructure Corp. Management’s Discussion and Analysis All amounts in Canadian $000s, unless otherwise indicated

• Optimization, diversification and expansion of organic waste processing facilities and RNG feedstock;

• Continued growth through strategic acquisitions and consolidation opportunities;

• Developing strategic partnerships and advancing RNG project pipelines;

• EverGen’s expectation to continue to pursue opportunities within its core markets and across North America;

• The ability to secure and optimize long-term contracts for RNG offtake and feedstock inputs;

• • Continued growth of the feedstock opportunity from municipal and commercial sources and our ability to build relationships with municipal, commercial and utility customers;

• The ability to create efficiencies through the integration of talent, systems and processes across acquired capital;

• The growth of the RNG industry;

• The growth and success of EverGen focussed on realizing consolidation opportunities and achieving synergies in cost and margin;

• • That successful acquisitions provide EverGen with additional growth opportunities;

• The ability of EverGen to meet its future anticipated obligations incurred from normal ongoing operations;

• • The ability for EverGen to complete certain financing initiatives;

• That funds received under loan facilities will be sufficient to fund the core RNG expansion projects; and

• That EverGen generates sufficient amounts of cash and cash equivalents from operating activities to maintain the current level of operations.

Such forward-looking statements reflect the current views of EverGen with respect to future events, and are subject to certain risks, uncertainties and assumptions. Many factors could cause EverGen’s actual results, performance or achievements to be materially different from any expected future results, performance or achievement that may be expressed or implied by such forward looking statements and, accordingly, no assurance can be given that any of the events anticipated by the forward-looking statements will transpire or occur, or if any of them do, what benefits EverGen will derive therefrom. 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 the Company 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. Forward-looking-statements, by their nature, involve risks and uncertainties. Certain of these risks are included in “Risks and Uncertainties” in this MD&A and “Risk Factors” in the Company’s AIF dated April 22, 2024, which factors should not be considered exhaustive and should be read together with the other cautionary statements in this MD&A. Given these risks, uncertainties and assumptions, readers are cautioned not to place undue reliance on these forward-looking statements. The forward-looking statements contained in this MD&A are made as of the date hereof, and 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. The forward-looking statements and information contained in this MD&A may not be appropriate for other purposes. 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.

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