Item 1.01 Entry into a Material Definitive Agreement.
On November 3, 2021, Archaea
Energy Inc. (the “Company”) and LFG Acquisition Holdings LLC, a subsidiary of the Company (“Opco”), entered into
a Share Repurchase Agreement (the “Repurchase Agreement”) with Aria Renewable Energy Systems LLC, a Delaware limited liability
company (“Aria RES”). Pursuant to the Repurchase Agreement, on a weekly basis during the period beginning on November 3,
2021 and ending on the date that is one week after the date on which the Company has received all cash payments from exercises of the
Redeemable Warrants (as defined below), the Company will repurchase from Aria RES the number of
shares of the Company’s Class A common stock, par value $0.0001 per share (“Class A Common Stock”), equal to all cash
received by the Company from exercises of the Redeemable Warrants during the preceding calendar week divided by $17.65 (rounded down to
the nearest whole number). Assuming all of the holders of the Redeemable Warrants exercise their warrants for cash prior to the Redemption
Date (as defined below), the Company would receive approximately $139.3 million in cash and would repurchase 7,891,991 shares of Class
A Common Stock from Aria RES. The holders of the Redeemable Warrants may elect to exercise their Redeemable Warrants by paying the exercise
price with cash or may elect to exercise on a “cashless basis,” which would reduce the cash proceeds received by the Company
and, correspondingly, the number of shares repurchased from Aria RES. The foregoing description of the Repurchase Agreement is not complete
and is qualified in its entirety by reference to the copy of the Repurchase Agreement filed as Exhibit 10.1 hereto, which is incorporated
herein by reference.
As of November 3, 2021, Aria
RES beneficially owns 21,700,232 shares of the Company’s Class B common stock, par value $0.0001 per share (“Class B Common
Stock”), and 21,700,232 Class A units of Opco (“Opco Class A units”), which it received as partial consideration in
the Aria Merger (as defined and further described in the Company’s Current Report on Form 8-K filed on September 21, 2021). Pursuant
to the Second Amended and Restated Limited Liability Company Agreement of Opco, at the request of the holder, each Opco Class A unit may
be redeemed for, at Opco’s election, a newly-issued share of Class A Common Stock or a cash payment equal to the Cash Election Amount
(which is generally the volume-weighted average closing price of one share of Class A Common Stock for the five consecutive trading days
prior to the date on which the holder requested the redemption), and upon redemption of such Opco Class A unit, a share of Class B Common
Stock shall be surrendered by the holder and cancelled by the Company.
In connection with the Aria Merger,
upon consummation thereof on September 15, 2021, Aria RES, along with certain other stockholders of the Company, entered into a Stockholders’
Agreement with the Company (the “Stockholders Agreement”). Pursuant to the Stockholders Agreement, among other things, (i)
Aria RES and certain other parties thereto were granted certain customary registration rights, (ii) Aria RES, its affiliates and their
permitted transferees (the “Ares Investor”) have the right to designate one director (the “Aria Director”) for
appointment or election to the board of directors of the Company (the “Board”) for so long as the Ares Investor holds at least
50% of the Registrable Securities (as defined in the Stockholders Agreement) held by it upon consummation of the Aria Merger (the first
date on which the Ares Investors no longer holds such amount, the “Aria Fall-Away Date”), and (iii) until the Aria Fall-Away Date,
the Board shall consult with Aria RES (and the other “Aria Holders” as defined in the Stockholders Agreement) regarding the
persons to be designated as independent directors. On the Aria Fall-Away Date, the right of the Ares Investor to designate a director
shall cease and the term of the then-current Aria Director shall thereupon automatically end. Additionally, pursuant to the Stockholders
Agreement, Aria RES and the other Aria Holders are subject to a 180-day lock-up period on transferring their equity interests in the Company
and Opco, subject to early expiration based on the per share trading price of the Class A Common Stock, as set forth in the Stockholders
Agreement. The Stockholders Agreement generally provides that if, following the consummation of the Aria Merger on September 15, 2021,
the last sale price of the Class A Common Stock on the New York Stock Exchange for any 10 trading days within any 15 trading-day period
commencing 15 days after the consummation of the Aria Merger exceeds (i) $13.50 per share, then the Aria Holders, together with their
permitted transferees, may transfer the equity interests in the Company that they received in the Aria Merger (the “Aria Closing
Shares”) during the 180-day lock-up period without restriction in an amount up to one-third of the Aria Closing Shares, (ii) $16.00
per share, then the Aria Holders, together with their permitted transferees, may transfer up to an additional one-third of the Aria Closing
Shares in excess of the Aria Closing Shares described in the foregoing clause (i) (i.e., up to two-thirds of the Aria Closing Shares in
the aggregate) without restriction, and (iii) $19.00 per share, then the Aria Holders, together with their permitted transferees, may
transfer any of the Aria Closing Shares without restriction. The Stockholders Agreement is further described in the Company’s Current
Report on Form 8-K filed on September 21, 2021 and a copy thereof is filed therewith as Exhibit 10.13.