PEA.RT Pieridae Energy Limited

Pieridae Energy Limited (“Pieridae” or the “Company”) (TSX: PEA) is pleased to announce that it is offering rights (the “Rights Offering”) to eligible holders of its common shares (the “Common Shares”) of record at the close of business on September 9, 2024 (the “Record Date”).

Pursuant to the Rights Offering, each holder of Common Shares resident in a province or territory in Canada (the “Eligible Jurisdictions”) will receive one right (a “Right”) for each one Common Share held. Each Right will entitle the holder to subscribe for 0.71286 of a Common Share (the “Basic Subscription Privilege”). As a result, holders of Common Shares may exercise 1.4028 Rights and pay $0.2448 per share (the “Subscription Price”) to acquire one Common Share. The Subscription Price represents a discount of 25% to the 5-day volume weighted average trading price of the Common Shares on the Toronto Stock Exchange (the “TSX”) prior to the date hereof, the discount applied to meet the requirements of the TSX.

Pieridae expects to raise gross proceeds of up to $30 million from the Rights Offering and intends to use the proceeds to repay indebtedness, for working capital and general corporate purposes and to fund certain value-accretive optimization projects. The expected closing date of the Rights Offering is October 7, 2024.

The Rights issued under the Rights Offering will expire at 3:00 p.m. MDT on October 2, 2024 (the “Expiry Date”), after which time unexercised Rights will be void and of no value. The Rights Offering includes an additional subscription privilege under which eligible holders of Rights who fully exercise their Basic Subscription Privilege will be entitled to subscribe for additional available Common Shares on a pro rata basis that are not otherwise subscribed for under the Basic Subscription Privilege.

In connection with the Rights Offering, the Company has entered into a standby purchase agreement (the “Standby Purchase Agreement”) with Alberta Investment Management Corporation (“AIMCo”), which has agreed, subject to the satisfaction of certain conditions, to fully exercise its Basic Subscription Privilege to purchase 24,498,749 Common Shares and to purchase up to an additional 77,625,434 Common Shares not otherwise subscribed for under the Rights Offering (the “Standby Commitment”), which will ensure that the Company receives gross proceeds under the Rights Offering of at least $25 million. If the Standby Commitment is utilized in full and no other Pieridae shareholders exercise Rights, AIMCo will own approximately 49.81% of the issued and outstanding Common Shares on completion of the Rights Offering. Completion of the Rights Offering is subject to the satisfaction or waiver of the conditions under the Standby Purchase Agreement.

Darcy Reding, President and CEO commented, “We are extremely pleased to provide our shareholders with the opportunity to directly participate in Pieridae’s future through a backstopped rights offering. The ongoing support of our valued shareholders, particularly AIMCo which is committing up to $25 million, is instrumental in accelerating our strategic execution. Investing in value-enhancing well optimization, facility consolidation and debottlenecking projects is expected to improve revenue, lower costs and increase processing capacity to meet growing third-party demand at our processing facilities.”

On closing of the Rights Offering, Pieridae will enter into an investor rights agreement (the “Investor Rights Agreement”) and a registration rights agreement (the “Registration Rights Agreement”) with AIMCo. The Investor Rights Agreement will grant AIMCo certain board nomination and observer rights, and the Registration Rights Agreement will grant AIMCo certain distribution and registration rights, in each case as mutually agreed by Pieridae and AIMCo. The Investor Rights Agreement and Registration Rights Agreement will each terminate at such time that AIMCo and its affiliates together hold less than 10% of the Common Shares.

Copies of the Standby Purchase Agreement, Investor Rights Agreement, and Registration Rights Agreement will be filed under Pieridae’s profile on SEDAR+ at www.sedarplus.ca.

There are currently 171,911,336 Common Shares outstanding. An aggregate of 171,911,336 Rights are expected to be issued to subscribe for up to 122,549,019 Common Shares pursuant to the Rights Offering. The final number of Rights to be issued will depend on the actual number of issued and outstanding Common Shares on the Record Date. Following completion of the Rights Offering and assuming the exercise of all Rights, Pieridae expects that there will be approximately 294,460,355 Common Shares outstanding.

No fractional Common Shares will be issued and, where the exercise of Rights would otherwise entitle the holder of Rights to fractional Common Shares, the holder’s entitlement will be reduced to the next lowest whole number of Common Shares. No cash or other consideration will be paid in lieu thereof.

The Rights will be listed for trading on the TSX under the symbol “PEA.RT” commencing on September 9, 2024 and will be de-listed from the TSX at 10:00 a.m. MDT on the Expiry Date.

The Rights Offering will be conducted only in the Eligible Jurisdictions. Accordingly, and subject to the detailed provisions of Pieridae’s Rights Offering circular (the “Circular”), Rights will not be delivered to, nor will they be exercisable by, persons resident outside of the Eligible Jurisdictions (“Ineligible Holders”), unless an Ineligible Holder satisfies Pieridae that their participation in the Rights Offering is lawful and in compliance with all applicable securities and other legislation, in which case Pieridae may direct the depositary and subscription agent, Odyssey Trust Company (“Odyssey”), to issue Rights to such Ineligible Holder who will no longer be an Ineligible Holder. After 3:00 p.m. MDT on September 22, 2024 (10 days prior to the Expiry Date), any Rights still held by Odyssey on behalf of Ineligible Holders may be sold on their behalf by Odyssey.

Details of the Rights Offering are set out in Pieridae’s Rights Offering notice (the “Notice”) and Circular, which will be available under Pieridae’s profile on SEDAR+ at www.sedarplus.ca. It is expected that the Notice, a direct registration system advice representing the Rights (the “DRS Advice”) and a subscription form (the “Subscription Form”) will be mailed to each registered shareholder of the Company resident in the Eligible Jurisdictions as at the Record Date. Registered shareholders who wish to exercise their Rights must deliver the DRS Advice, together with the completed Subscription Form and the applicable funds, to Odyssey at or before 3:00 p.m. MDT on the Expiry Date. Shareholders who hold their Common Shares through an intermediary, such as a bank, trust company, securities dealer, or broker, are expected to receive materials and instructions from their intermediary.

The Rights and the Common Shares issuable upon exercise of the Rights have not been, and will not be, registered under the United States Securities Act of 1933, as amended and, accordingly, the Rights and the Common Shares are not being publicly offered for sale in the “United States” or to “U.S. persons” (as such terms are defined in Regulation S under the United States Securities Act of 1933, as amended). This press release does not constitute an offer to sell or the solicitation of an offer to buy the securities in any jurisdiction. There shall be no sale of the securities in any jurisdiction in which an offer to sell, a solicitation of an offer to buy, or a sale would be unlawful.

ADVISORS

Peters & Co. Limited is acting as exclusive financial advisor to Pieridae with respect to the Rights Offering. Norton Rose Fulbright Canada LLP is acting as Pieridae’s legal advisor.

ABOUT PIERIDAE

Pieridae is a Canadian energy company headquartered in Calgary, Alberta. The Company is a significant upstream producer and midstream custom processor of natural gas, natural gas liquids, condensate, and sulphur from the Canadian Foothills and adjacent areas in Alberta and in northeast British Columbia. Pieridae’s vision is to provide responsible, affordable natural gas and derived products to meet society’s energy security needs. Pieridae’s Common Shares trade on the TSX under the symbol “PEA”.

For further information, visit www.pieridaeenergy.com, or please contact:

Darcy Reding, President & Chief Executive Officer	Adam Gray, Chief Financial Officer
Telephone: (403) 261-5900	Telephone: (403) 261-5900
Investor Relations
investors@pieridaeenergy.com

Forward-Looking Statements

Certain of the statements contained herein may constitute “forward-looking statements” or “forward-looking information” within the meaning of applicable securities laws (collectively “forward-looking statements”). Words such as “may”, “will”, “should”, “could”, “would”, “intends”, “expects”, “anticipates”, “assumes”, “increase”, “reduce”, “accelerate”, “growing”, “condition”, “completion”, “vision”, “project”, “future”, “strategy”, “proposition”, “ongoing” and other similar words and expressions may be used to identify the forward-looking statements contained herein. These statements reflect management’s current beliefs and are based on information currently available to management. Forward-looking statements contained herein include, without limitation: expected gross proceeds under the Rights Offering; intended use of proceeds from the Rights Offering; anticipated benefits of the Rights Offering, including, but not limited to, accelerating the Company’s strategic execution, improving revenue, lowering costs and increasing processing capacity to meet third-party demands; expectations with respect to ongoing support from the Company’s shareholders, including AIMCo; anticipated shareholder participation in the Rights Offering; expectations with respect to the Standby Purchase Agreement, including satisfaction of closing conditions thereunder; fulfilment of the Standby Commitment and AIMCo’s ownership position following completion of the Rights Offering; expectations with respect to entering into the Investor Rights Agreement and the Registration Rights Agreement; the anticipated number of Rights to be issued under the Rights Offering and number of Common Shares that will be outstanding following completion of the Rights Offering; expectations with respect to the closing of the Rights Offering, including timing thereof; expectations with respect to mailing the Notice, a DRS Advice and a Subscription Form to each registered shareholder of the Company resident in the Eligible Jurisdictions as of the Record Date; expectations with respect to participation of Ineligible Holders in the Rights Offering, including the Company’s decision to allow any Ineligible Holder to participate; and the Company’s vision to provide responsible, affordable natural gas and derived products.

Forward-looking statements involve significant risk and uncertainties. A number of factors could cause actual results to differ materially from the results discussed in the forward-looking statements including, but not limited to, the risks associated with oil and gas exploration, development, exploitation, production, processing, marketing and transportation, loss of markets, volatility of commodity prices, currency fluctuations, imprecision of resources estimates, environmental risks, competition from other producers, incorrect assessment of the value of acquisitions, failure to realize the anticipated benefits of acquisitions, delays resulting from or inability to obtain required regulatory approvals, and ability to access sufficient capital from internal and external sources. These and other risk factors are discussed in more detail under “Risk Factors” and elsewhere in Pieridae’s Annual Information Form for the year ended December 31, 2023 and under “Risk Factors” in the Circular, copies of which are available on the Company’s profile on SEDAR+ at www.sedarplus.ca. Additional risk factors include, but are not limited to: the Rights Offering may not be completed, or may not be completed on the terms and timeline as currently expected, including with respect to the Standby Commitment.

Forward-looking statements are based on a number of factors and assumptions which have been used to develop such forward-looking statements, but which may prove to be incorrect. Although Pieridae believes that the expectations reflected in such forward-looking statements are reasonable, undue reliance should not be placed on forward-looking statements because Pieridae can give no assurance that such expectations will prove to be correct. In addition to other factors and assumptions which may be identified in this document, assumptions have been made regarding, among other things: the impact of increasing competition; the general stability of the economic and political environment in which Pieridae operates; the ability of Pieridae to obtain and retain qualified staff, equipment and services in a timely and cost efficient manner; the ability of the operator of the projects which Pieridae has an interest in to operate the field in a safe, efficient and effective manner; the ability of Pieridae to obtain financing on acceptable terms; the ability to replace and expand oil and natural gas resources through acquisition, development and exploration; the timing and costs of pipeline, storage and facility construction and expansion and the ability of Pieridae to secure adequate product transportation; future oil and natural gas prices; currency, exchange and interest rates; the regulatory framework regarding royalties, taxes and environmental matters in the jurisdictions in which Pieridae operates; timing and amount of capital expenditures; future sources of funding; production levels; weather conditions; success of exploration and development activities; access to gathering, processing and pipeline systems; advancing technologies; and the ability of Pieridae to successfully market its oil and natural gas products.

Readers are cautioned that the foregoing list of assumptions and risk factors is not exhaustive. Additional information on these and other factors that could affect Pieridae’s operations and financial results are included in reports on file with Canadian securities regulatory authorities and may be accessed through the SEDAR+ website (www.sedarplus.ca), and at Pieridae’s website (www.pieridaeenergy.com).

Although the forward-looking statements contained herein are based upon what management believes to be reasonable assumptions, management cannot assure that actual results will be consistent with these forward-looking statements. Investors should not place undue reliance on forward-looking statements. These forward-looking statements are made as of the date hereof and Pieridae assumes no obligation to update or review them to reflect new events or circumstances except as required by applicable securities laws.

Forward-looking statements contained herein concerning the oil and gas industry and Pieridae’s general expectations concerning this industry are based on estimates prepared by management using data from publicly available industry sources as well as from reserve reports, market research and industry analysis and on assumptions based on data and knowledge of this industry which Pieridae believes to be reasonable. However, this data is inherently imprecise, although generally indicative of relative market positions, market shares and performance characteristics. While Pieridae is not aware of any misstatements regarding any industry data presented herein, the industry involves risks and uncertainties and is subject to change based on various factors.

Neither TSX nor its Regulation Services Provider (as that term is defined in policies of the TSX) accepts responsibility for the adequacy or accuracy of this release.