Renewal and Restructure of Credit Facilities

About this update from Prospera Energy Inc.

[{"type":"text","content":"Renewal and Restructure of Credit FacilitiesKELOWNA, BC / ACCESSWIRE / May 08, 2019 / Prospera Energy Inc. ('Prospera' or the 'Corporation') (PEI:TSX-V; OF6A:FRA) is pleased to announce that the Corporation successfully completed the sale of its Silverdale assets on May 2nd, 2019 for gross proceeds totalling $330,000. In addition to the completion of the Silverdale assets sale, Prospera has also signed terms of an amending agreement ('Second Amending Agreement') with its Lender ('Lender') for the renewal of its Credit Facilities, which relaxed certain financial covenant thresholds effective April 30, 2019 through April 30, 2020. Prospera Energy expects that the amended agreement will provide the Corporation with additional financial flexibility and runway to execute its 2019 capital program while continuing to deliver long-term growth in reserves, production and cash flow for shareholders. In light of the impact from the widening Canadian crude oil price differentials during the fourth quarter of 2018 on the computation of Prospera's financial covenants for 2019, the lender has agreed to apply certain financial provisions as outlined below:(a) Upon receipt of the lump sum principal payment of $400,000, no later than May 31, 2019 from the Corporation, pursuant to the terms outlined in the Second Amending Agreement dated April 30, 2019, the Lender will provide $400,000 of debt of forgiveness such that the reduction of the principal amount owing under the Credit Facilities will be $800,000.(b) The interest rate shall reduce to 9.5% effective upon the Corporation making the $400,000 lump sum principal payment from the proceeds of the sale of the Corporation's Silverdale assets no later than May 31, 2019.(c) Upon the occurrence or fulfillment of all of the conditions set forth in the Commitment Letter, as amended by this Second Amending Agreement, the Lender agreed to waive (a) all Events of Default under the Commitment Letter which have occurred up to and including December 31, 2018 and (b) the requirement to pay the deferred fees and default interest, as such terms are defined in the Commitment Letter, owing as of December 31, 2018, which amount is $535,520.41. (In the event of default the interest rate will be 12%). The Corporation has currently issued $285,000.00 from the proceeds of the Silverdale sale in payment to its Lender a...

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