Core Viewpoint - Prairie Provident Resources Inc. is pursuing a non-binding term sheet for a proposed preferred share financing to raise approximately US$18.9 million (C$26.5 million) and is seeking amendments to its existing debt agreements to improve its financial situation and liquidity [1][3][24]. Proposed Financing - The proposed financing involves the sale of preferred shares to an investor affiliated with the company's largest shareholder, PCEP, at an issue price of C$100 per share, with an annual yield of 8% [6][7]. - The financing is critical for the company to meet existing obligations, strengthen working capital, and fund a development program to drill four new wells by year-end 2025 [4][24]. Debt Amendments - The debt amendments will extend the maturity dates of the First Lien Loan and Second Lien Notes by 24 months and allow the company to defer cash interest obligations through 2026 [16][17]. - These amendments are interrelated with the proposed financing, meaning completion of one is dependent on the other [5]. Financial Hardship Application - Prairie Provident has applied for an exemption from shareholder approval requirements under TSX rules due to its serious financial difficulties, asserting that the proposed financing and debt amendments are necessary for its survival [3][28][30]. Use of Proceeds - The net proceeds from the proposed financing will be allocated as follows: approximately C$8 million for retiring payables, C$13 million for drilling and completing new wells, C$1 million for infrastructure payments, and C$3.5 million for abandonment work [23][24]. Operational Context - The company has faced challenges due to commodity price weakness and insufficient cash flow to meet obligations, necessitating external financing to support its operations and development plans [20][21][29]. - Prairie Provident's recent drilling activities have shown positive results, but additional capital is required to sustain growth and address a significant working capital deficit [19][21][22]. Investor Rights Agreement - The Investor Rights Agreement will be amended to include the new investor, granting them rights such as director nominations and pre-emptive rights for future equity offerings [13][15]. Conditions to Completion - Completion of the proposed financing and debt amendments is contingent upon satisfactory due diligence, execution of definitive agreements, and necessary approvals from the TSX [2][18].