BURLINGTON, Ontario–(BUSINESS WIRE)– Anaergia Inc. (“Anaergia” or the “Company”) (TSX: ANRG) announced today that one of its subsidiaries, Rialto Bioenergy Facility, LLC (“RBF”), initiated voluntary Chapter 11 restructuring proceedings in the U.S. Bankruptcy Court for the Southern District of California. RBF is 51% owned by Anaergia’s wholly owned subsidiary, Anaergia Services, LLC. RBF anticipates that, during the restructuring proceeding, it will continue to operate its state-of-the-art, multi-feedstock bioenergy facility in Rialto, California, which is capable of converting organic waste, such as food and yard waste and biosolids, into carbon-negative renewable natural gas, with the capability to generate renewable electricity and soil amendment/fertilizer.
The following is a brief summary of the matters the Company considered:
Subject to court approval, RBF, as borrower, intends to enter into a debtor-in-possession (“DIP”) financing facility with a lender, pursuant to which the lender will make available to RBF a non-revolving secured credit facility. This financing facility will enable RBF to continue to operate its business and meet its financial obligations, including the timely payment of charges for labor, supplies and other obligations as approved by the court. Additionally, the Company will not be guarantying the DIP financing facility, as RBF has more than sufficient value to support the new loan. RBF is committed to working closely with its stakeholders to minimize the impact of the bankruptcy process and to ensure that its creditors are treated fairly.
“After careful evaluation by the managers of RBF, with due consideration of a range of alternatives, the RBF board believes that the Chapter 11 process is in the best interests of RBF and its stakeholders. Debt restructuring will allow RBF to address its liquidity challenges, preserve its ability to ramp up operations as the availability of feedstock is expected to increase in tandem with enforcement by the City of Los Angeles of subscription to organic waste collection and landfill diversion requirements mandated by ordinance and State law,” said Yaniv Scherson, RBF board member and Vice President of RBF and Chief Operating Officer of Anaergia. “RBF is strongly supported by the State of California and is critical to the success of SB 1383. We are confident that these actions will help protect the value of RBF and allow it to emerge as a stronger company.”
Anaergia was created to eliminate a major source of greenhouse gases by cost effectively turning organic waste into renewable natural gas (RNG), fertilizer and water, using proprietary technologies. With a proven track record from delivering world-leading projects on four continents, Anaergia is uniquely positioned to provide end-to-end solutions for extracting organics from waste, implementing high efficiency anaerobic digestion, upgrading biogas, producing fertilizer and cleaning water. Our customers are in the municipal solid waste, municipal wastewater, agriculture, and food processing industries. In each of these markets Anaergia has built many successful plants including some of the largest in the world. Anaergia owns and operates some of the plants it builds, and it also operates plants that are owned by its customers.
This news release contains forward-looking information within the meaning of applicable securities legislation, which reflects the Company’s current expectations regarding future events, including statements relating to the timing of events relating to Rialto’s initiation of the Chapter 11 restructuring and the anticipated deconsolidation and the impacts thereof on the Company’s financial statements. Forward-looking information is based on a number of assumptions and is subject to a number of risks and uncertainties, many of which are beyond the Company’s control. Such risks and uncertainties include, but are not limited to, the factors discussed under “Risk Factors” in the Company’s annual information form dated April 10, 2023 for the fiscal year ended December 31, 2022. Actual results could differ materially from those projected herein. Anaergia does not undertake any obligation to update such forward-looking information, whether as a result of new information, future events or otherwise, except as expressly required under applicable securities laws.
For further information please see: www.anaergia.com
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