Mr. Frank Carnevale reports

CLEANTECH POWER CORP. ENTERS INTO NON-BINDING LETTER OF INTENT TO ACQUIRE COMBINED HEAT AND POWER ASSETS

Cleantech Power Corp. has entered into a non-binding letter of intent with an arm's-length third party to acquire, directly and indirectly, certain operating combined heat and power (CHP) and other assets located in North America.

Pursuant to the letter of intent, the company may acquire the CHP assets by making two payments. The first payment relates to CHP assets that are past commercial operation and will consist of a payment of approximately $7.5-million (the COD payment). The COD payment will be made on close of the potential transaction. The second payment relates to CHP assets that are currently not past their commercial operation date and will consist of a payment of approximately $5-million (the non-COD payment). The non-COD payment will be made in the sole discretion of the company. The company believes that, if consummated, the transactions contemplated in the letter of intent have the potential to provide the company with approximately $1.5-million annual cash flow. Certain of the projects associated with the CHP assets are subject to contract terms between 15 and 20 years.

"Cleantech Power is focused on delivering our vision of combining stable energy streams with advanced hydrogen technology to bring value to investors," stated Frank Carnevale, chief executive officer of Cleantech Power. "In addition to the potential transaction contributing towards the company becoming EBITDA positive, the new project pipeline associated with the CHP assets would bring our current total on non-contracted sales leads to over $150-million in CHP projects to develop in the coming years."

Revenue growth and synergies

The acquisition of CHP assets is consistent with the company's previous acquisition dated April 22, 2023, and supports the company's focus on the development of affordable, renewable and reliable power assets.

The potential transaction is synergistic and has the potential to support the company in the following ways:

• Deliver EBITDA (earnings before interest, taxes, depreciation and amortization) to the company;
• Provides approximately $100-million in potential future project opportunities;
• Cost of natural gas inputs and carbon taxes are covered by offtaker customers, limiting spark spread risk to the company;
• Project economics are not anticipated to be subject to government subsidies or carbon credits to be viable;
• Adds project development and CHP experience to the company;
• Offtakers of CHP asset contracts may provide future opportunities to increase integration of fuel cells;
• The CHP assets may enable the use of other clean technology during the lifespan of the contracts with customers.

The projects associated with the CHP assets are synergistic with the company's experience in operations of other CHP assets currently in the company's portfolio. Cleantech Power believes operations and generation production may be further optimized over time, providing the potential for increased returns to the company and its shareholders. If consummated, the potential transaction is expected to assist the company in financing current operations, including the development of its fuel cell assets (as defined herein) and other clean technology.

As announced on April 4, 2023, Cleantech Power is currently working toward securing its fuel cell assets held at Fuel Cell Power NV in Belgium.

Financing

The potential transaction is non-binding in nature and is subject to the company arranging suitable financing. There is no guarantee that financing will be arranged; however, the company is exploring financing options and may finance the aggregate payment amount and the purchase of the CHP assets through a combination of third party secured debt, drawing down the approximately $5-million in convertible debt note financing announced on Nov. 18, 2022, and March 14, 2023, that the company currently has access, or other financing alternatives.

The company is currently performing financial, legal and operational diligence on the CHP assets and will provide further updates to the market if the potential transaction materializes.

2023 priorities

On March 6, 2023, the company announced 2023 priorities, and the acquisition of the CHP assets will contribute toward achieving positive EBITDA for the company over the coming five to seven quarters.

The company will use this opportunity to assess and confirm financing opportunities to enable the development of sales opportunities it acquired from AI Renewables, sales pipeline within acquisition and additional project opportunities.

About Cleantech Power Corp.

Cleantech Power is a diversified investment platform developing affordable, renewable and reliable power assets and clean technology. The company brings power to the people today, combining a stable revenue stream with a future-forward vision to commercialize its advanced hydrogen fuel cell technology to meet the massive global market need and ultimately generate compelling returns for investors. Cleantech Power is well positioned to deliver power to the people in the global energy transition while offering a diversified clean tech growth platform for investors. Common shares are listed for trading on the NEO Exchange under the symbol PWWR, on the OTC Venture Exchange (OTCQB) under the symbol PWWRF and on the Frankfurt Stock Exchange under symbols E43 and WKN A3EEHV.

We seek Safe Harbor.