Prairie Provident Announces Completion of Recapitalization Transactions and Closing of Fully Subscribed C$4 Million Equity Financing

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CALGARY, Alberta, May 16, 2023 (GLOBE NEWSWIRE) -- Prairie Provident Resources Inc. (TSX:PPR) (the “Company”), is pleased to announce the completion of its previously announced recapitalization transactions (collectively, the “Recapitalization”). The Recapitalization included the following principal transactions:

• closing today of the Company's brokered private placement offering of units of the Company (the “Units”) at a price of C$0.09 per Unit, for aggregate gross proceeds to the Company of C$4 million (the “Equity Financing”);
• completion on March 30, 2023 of the Company's issuance and sale of second lien notes due December 31, 2024 in the principal amount of US$3.64 million (approximately C$5 million at the then-prevailing exchange rate) to certain affiliates of the Former Noteholder (as defined herein);
• settlement today of all outstanding indebtedness under the outstanding subordinated notes (“Subordinated Notes”) previously held by PCEP Canadian Holdco, LLC (the "Former Noteholder"), in the aggregate amount of US$53.4 million (approximately C$72.0 million at the current exchange rate), through the issuance of 514.4 million common shares of the Company ("Common Shares") at an agreed repayment price equal to C$0.14 per Common Share (representing a 56% premium to the Unit offering price under the Equity Financing) (the "Subordinated Notes Settlement");
• concurrently with the Subordinated Notes Settlement, exercise by the Former Noteholder, on a cashless basis, of the 34,292,360 warrants of the Company held by it and exercisable at C$0.0192 per share, for an issuance of an additional 26.5 million Common Shares (the "Warrant Exercise"); and
• amendments to the agreement governing its senior secured credit facility to, among other things, waive certain defaults, provide additional covenant flexibility, and extend the maturity date to July 1, 2024.
  

Completion of the Recapitalization positions the Company with the flexibility and capital to execute its long-term strategy to optimize its current producing assets as well as develop its currently undeveloped land base. Significant improvements to the Company's overall leverage and non-cash interest burden are expected to allow the Company to direct more of its operating cash flow towards additional low-risk well reactivations, optimization, and development drilling, and execute on non-dilutive, non-core asset dispositions and/or other transaction opportunities.