Prairie Provident Secures $10 Million in Rights Offering
Prairie Provident Secures $10 Million in Rights Offering
CALGARY, Alberta — Prairie Provident Resources Inc. (TSX:PPR) is thrilled to share significant news regarding its ongoing $13.2 million rights offering. The company has successfully closed an initial subscription worth $10 million from its principal shareholder, PCEP Canadian Holdco, LLC. This funding marks an important milestone as Prairie Provident pursues growth and development in its operations.
Details of the Rights Offering
The rights offering allows Prairie Provident to issue up to 529,579,000 common shares at a price of $0.025 each. If fully subscribed, this would generate approximately $13.2 million for the company. The $10 million from PCEP accounts for about 75.5% of the total offering, enabling the acquisition of 400,000,000 additional common shares. This substantial investment reflects PCEP's confidence and commitment to Prairie Provident.
Usage of the Subscription Funds
PCEP's financial commitment was partially settled through a $3.13 million setoff against a previous advance under the company's second lien note facility, received in May. The remaining sum, approximately $6.87 million, was provided in cash. This strategic financial maneuver helps to reduce debt while bolstering the company’s equity position.
Participation from Directors and Management
In addition to PCEP's investment, the directors and management of Prairie Provident contributed an additional $400,000 in subscriptions, acquiring a total of 16,000,000 common shares. This collective effort emphasizes the alignment of interests and confidence in the company's future prospects.
Timeframe for the Rights Offering
The rights offering will continue to remain open, allowing eligible holders to exercise their subscription rights until 5:00 p.m. Mountain time on October 28, 2024. After this deadline, any unexercised rights will be considered void. Importantly, the completion of PCEP's subscription fulfills the minimum threshold necessary for the rights offering to proceed.
Additional Offerings and Future Prospects
PCEP retains the option to further acquire shares through a $1.6 million standby commitment outlined in the rights offering agreement. This opens the door for acquiring up to 64,000,000 more common shares, contingent on how many are taken up by other rights holders. The determination of how many shares PCEP will ultimately purchase will occur after the offering's conclusion.
Investment Strategy and Early Warning Disclosure
PCEP, having held 540,925,109 common shares before this acquisition, now possesses 940,925,109 shares, representing approximately 84.3% of total shares. This substantial holding underscores PCEP's strategic investment in Prairie Provident, which it views as a long-term growth opportunity. The acquired shares are designated for investment purposes, and PCEP may adjust its holdings based on market conditions and strategic considerations.
About Prairie Provident Resources Inc.
Prairie Provident is a resource-focused company situated in Calgary, dedicated to exploring and developing oil and natural gas properties primarily in Alberta. The organization is making excellent strides, particularly within the emerging Basal Quartz trend in the Michichi area of Central Alberta. This strategic focus enables Prairie Provident to harness its assets effectively and position itself for future success.
For further communication, please reach out to:
Ryan Rawlyk, President and CEO
Phone: (403) 292-8150
Email: investor@ppr.ca
Frequently Asked Questions
What is the total amount Prairie Provident has raised from the rights offering?
Prairie Provident has raised an initial $10 million from its rights offering, with the potential to raise more as the offering progresses.
Who is the principal shareholder contributing to the funding?
The principal shareholder contributing to this funding is PCEP Canadian Holdco, LLC.
What is the subscription price per share for the rights offering?
The subscription price per share is set at $0.025 under the rights offering.
How many shares did PCEP acquire under the offering?
PCEP acquired 400,000,000 common shares through its contribution.
When will the rights offering close?
The rights offering will close at 5:00 p.m. Mountain time on October 28, 2024.
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