Mr. George Richardson reports

GEORGE DAVID RICHARDSON FILES EARLY WARNING REPORT ACQUISITION

On March 21, 2023, George David Richardson acquired ownership, indirectly through Countryman Investment Ltd., a company wholly owned by Mr. Richardson: (i) 10 million common shares of Prospera Energy Inc. pursuant to the exercise of warrants at a price of 7.5 cents per share for gross proceeds of $750,000; (ii) two million shares and two million warrants pursuant to the conversion of a convertible debenture in the principal amount of $100,000 (the warrants are exercisable at a price of 7.5 cents per share for a period of two years from the date of issue); and (iii) 2.5 million stock options, of which 1.25 million are fully vested on the date grant and are exercisable at 10 cents per share for two years from the date of grant and 1.25 million options vest quarterly in the first year and are exercisable at 12.5 cents per share for a period of three years from the date of grant.

Prior to the transactions, the acquiror directly and indirectly owned and controlled an aggregate of:

• 28,630,454 shares;
• Debenture in the principal amount of $100,000;
• Two million shares and 2,000,000 warrants that are issuable on conversion of the debenture;
• 17,731,454 shares issuable on exercise of the warrants (including the two million warrants issuable on conversion of the debenture).

These securities represent 9.1 per cent of the 327,420,334 issued and outstanding shares as of March 20, 2023, the date prior to the acquisition of the shares, the warrants and the options, on a non-diluted basis. If the acquiror were to convert the debenture and exercise the warrants, the acquiror will directly and indirectly own and control 48,361,908 shares, or 14.4 per cent, of the issued and outstanding shares calculated on a partially diluted basis.

Following the transactions, the acquiror directly and indirectly owns and controls an aggregate of:

• 40,630,454 shares;
• 2.5 million shares issuable on exercise of the options;
• 7,731,454 shares issuable on exercise of the warrants (including the two million warrants issuable on conversion of the debenture).

These securities represent 12.41 per cent of the 327,420,334 issued and outstanding shares as of March 21, 2023, the date of the acquisition of the shares, the warrants and the options, on a non-diluted basis. If the acquiror were to exercise the outstanding the warrants and the options, the acquiror will directly and indirectly own and control 50,861,908 shares, or 15.06 per cent of the issued and outstanding shares calculated on a partially diluted basis.

Ten million shares were acquired on exercise of the warrants; two million shares and two million warrants were acquired on conversion of the debenture; and the options were granted as part of a consulting agreement between the company and the acquiror. This investment will be reviewed on a continuing basis by the acquiror and such holdings may be increased or decreased in the future. The acquiror may in the future acquire or dispose of the shares through the open market, privately or otherwise, as circumstances or market conditions warrant. The acquiror has filed an early warning report pursuant to National Instrument 62-103F1, The Early Warning System and Related Take-Over Bid and Insider Reporting Issues, describing the aforementioned transaction with the applicable securities regulatory authorities. A copy of the early warning report is available on SEDAR under the profile of the company.