CALGARY, Alberta – Prospera Energy Inc. PEI: TSX-V; OF6A: FRA, OTC: GXRFF
Prospera is structured to be well-capitalized in 2023 to fund the capital development program to capture the significant remaining reserves in place. PEI total capitalization ($15 million) includes strategic debt offering below, combined with substantial warrant exercise program of up to $10 million CAD in 2023 plus positive cash flow from operations.
PEI hereby announces that it is undertaking a non-brokered private placement debt financing. A total of up to $5,000,000 will be raised offering holders’ interest of 8% per annum, with interest payments to be made quarterly for a term of 2 years. In addition to interest, holders will receive one common share for each dollar of principal advanced, at the time of investment. The company already has received a subscription for $2,500,000 towards this offering.
Debt Term Sheet
|Issuer:||Prospera Energy Inc. (“Prospera” or the “Corporation”).|
|Issue:||Non-brokered offering (the “Offering“) of units (“Units“). Each Unit will consist of (I) one-thousand common shares of the Corporation (issued at closing); and (ii) one 8% 2-year promissory note in the principal amount of $1,000.|
|Issue Price:||$1,000 per Unit.|
|Offering Amount:||Up to $5,000,000.|
|Term:||Principal repaid at the end of 2 years.|
|Closing Date:||Anticipated for March 31, 2023.|
|Underlying Shares:||Common shares of the Company listed on the TSX Venture Exchange under the symbol PEI (the “Common Shares”).|
|Use of Proceeds:||Prospera intends to use the net proceeds of the Offering for infrastructure upgrades to accommodate further production growth, well development capital, well abandonment costs, ongoing ESG initiatives and general working capital.|
|Interest:||8% interest per annum, calculated and paid quarterly in cash starting after the 2nd quarter (interest in the first quarter is compounded).|
|Minimum Investment:||Notes will be issued in denominations of $1,000, subject to a minimum investment of $10,000.|
|Offering Basis:||Non- brokered private placement offering.|
|Finders Fees:||The Corporation may pay qualified finders a fee of 3% cash and 3% warrants.|
Prospera’s strategic evaluation suggests equity values are not appropriately accounting for the future potential of its asset values (i.e., 350 million+ barrels in place). The company is focused on minimal dilution financing options moving forward and if fully subscribed, this debt financing would only represent less than 2% equity dilution.
Prospera intends to use the net proceeds of the debt offering, cashflow from operations, and substantial capital raised from warrant exercises, to accelerate the company’s planned drill program this spring, summer, and fall to further production growth. There are significant economic advantages in drilling during the upcoming summertime.
Parties interested in participating in this debt offering should contact the company immediately. Insiders may participate in this offering. Prospera is relying upon exemptions contained in MI61-101 from the requirements for an independent evaluation and minority shareholder approval. This offering is subject to approval from the TSX Venture exchange.