Saskatoon, SK, November 14, 2023 – Royal Helium Ltd. (TSXV: RHC) (OTCQB: RHCCF) (“Royal” or the “Company“) is pleased to announce the closing of the first tranche of its previously announced underwritten private placement offering of 18,750,000 units of the Company (the “Units“), at an issue price of $0.24 per Unit for aggregate gross proceeds of $4,500,000 (the “First Tranche Offering“).
The First Tranche Offering was conducted pursuant to the terms and conditions of an underwriting agreement (the “Underwriting Agreement“) among the Company, Research Capital Corporation as the lead underwriter and sole bookrunner (the “Lead Underwriter“), on behalf of a syndicate of underwriters, including Cormark Securities Inc. and Eight Capital (together with the Lead Underwriter, the “Underwriters“).
Each Unit consists of one common share in the capital of the Company (a “Common Share“) and one Common Share purchase warrant (a “Warrant“). Each Warrant shall entitle the holder thereof to purchase one Common Share (a “Warrant Share“), at an exercise price of $0.31 per Warrant Share for a period of 36 months following the closing of the First Tranche Offering. The First Tranche Offering was conducted pursuant to the listed issuer financing exemption under Part 5A of National Instrument 45-106 – Prospectus Exemptions, and will not be subject to resale restrictions pursuant to applicable Canadian securities laws.
The net proceeds from the First Tranche Offering will be used to fund the multi-well operations at the Company’s Val Marie, Ogema and Steveville helium projects, along with production facilities design and engineering, and for general corporate purposes.
In connection with the First Tranche Offering, the Underwriters received a cash commission of $245,970 as well as 1,024,875 broker warrants (the “Broker Warrants“). Each Broker Warrant is exercisable to acquire one Unit for $0.24 and exercisable on or before November 14, 2026. In addition, the Underwriters received 25,125 advisory broker warrants on the same terms as the Broker Warrants.
This news release does not constitute an offer to sell or a solicitation of an offer to buy nor shall there be any sale of any of the securities in any jurisdiction in which such offer, solicitation or sale would be unlawful, including any of the securities in the United States of America. The securities described herein have not been and will not be registered under the 1933 Act or any state securities laws and may not be offered or sold within the United States or to, or for account or benefit of, U.S. Persons (as defined in Regulation S under the 1933 Act) unless registered under the 1933 Act and applicable state securities laws, or an exemption from such registration requirements is available.
About Royal Helium Ltd.
Royal Helium is an exploration, production, and infrastructure company with a primary focus on the development and production of helium and associated gases. The Company controls over 1,000,000 acres of prospective helium permits and leases across southern Saskatchewan and southeastern Alberta. Given the current and foreseeable global undersupplied nature of this critical and non-renewable product, Royal is well positioned to be a leading North American producer of this increasingly high value commodity.
Royal Helium’s helium reservoirs are carried primarily with nitrogen. Nitrogen is not considered a greenhouse gas (GHG) and therefore the plant has a low GHG footprint when compared to plants in other jurisdictions that rely on large scale natural gas production for helium extraction. Helium extracted from wells in Saskatchewan and Alberta can be up to 90% less carbon intensive than helium extraction processes in other jurisdictions.
Andrew Davidson President and Chief Executive Officer Royal Helium Ltd.
CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING INFORMATION
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this news release.
This news release includes certain statements that may be deemed to be “forward-looking statements”. All statements in news this release, other than statements of historical facts, that address events or developments that management of the Company expects, are forward-looking statements, including, the Company’s intended use of the net proceeds of the Offering. Although management believes the expectations expressed in such forward-looking statements are based on reasonable assumptions, such statements are not guarantees of future performance, and actual results or developments may differ materially from those in the forward-looking statements. The Company undertakes no obligation to update these forward-looking statements if management’s beliefs, estimates or opinions, or other factors, should change. Factors that could cause actual results to differ materially from those in forward-looking statements, include market prices, exploration and development successes, continued availability of capital and financing, and general economic, market or business conditions. Please see the public filings of the Company at www.sedarplus.ca for further information.
Royal Helium Ltd. (TSXV: RHC) (OTCQB: RHCCF) (“Royal” or the “Company”) is pleased to announce that, in connection with its previously announced overnight marketed offering (the “Offering”) of units of the Company (each, a “Unit”) at a price of $0.24 per Unit, it is increasing the size of the Offering to $5,175,000 in aggregate gross proceeds. The Offering is expected to close in two tranches, with the first tranche being in the amount of $4,500,000 and the second tranche being in the amount of $675,000. The Company is expected to enter into an underwriting agreement with Research Capital Corporation as the lead underwriter and sole bookrunner, on behalf of a syndicate of underwriters, including Cormark Securities Inc. and Eight Capital (collectively, the “Underwriters”).
Each Unit shall be comprised of one common share of the Company (a “Common Share”) and one purchase warrant of the Company (a “Warrant”). Each Warrant shall entitle the holder thereof to purchase one Common Share at an exercise price of $0.31 for a period of 36 months from the closing of the Offering. The Company will use commercially reasonable efforts to obtain necessary approvals to list the Warrants for trading on the TSX Venture Exchange.
The net proceeds from the Offering will be used for multi-well completions at Val Marie, Ogema and Steveville, design and engineering for offtake gas facilities, and for working capital and general corporate purposes.
The first tranche of the Offering is anticipated to close on or about November 14, 2023 (“Closing”), or such later date as the Company and the Underwriters may determine. The second tranche of the Offering is anticipated to close on or about December 14, 2023. The Closing is subject to certain conditions including, but not limited to, the receipt of all necessary regulatory and other approvals, including the approval of the TSX Venture Exchange.
The Offering will be conducted pursuant to the amendments to National Instrument 45-106 – Prospectus Exemptions (“NI 45-106”) set forth in Part 5A thereof (the “Listed Issuer Financing Exemption”) to purchasers resident in Canada, except Québec, and/or other qualifying jurisdictions. The Units offered under the Listed Issuer Financing Exemption will not be subject to resale restrictions pursuant to applicable Canadian securities laws. The Offering may be conducted in the United States pursuant to exemptions from the registration requirements under Rule 144A and/or Regulation D of the United States Securities Act of 1933, as amended (the “1933 Act“), subject to receipt of all necessary regulatory approvals, and in those other jurisdictions outside of Canada and the United States provided it is understood that no prospectus filing or comparable obligation arises in such other jurisdiction.
There is an offering document related to the Offering that can be accessed under the Company’s profile at www.sedarplus.ca and on the Company’s website at https://royalheliumltd.com/. Prospective investors should read this offering document before making an investment decision.
This news release does not constitute an offer to sell or a solicitation of an offer to buy nor shall there be any sale of any of the securities in any jurisdiction in which such offer, solicitation or sale would be unlawful, including any of the securities in the United States of America. The securities described herein have not been and will not be registered under the 1933 Act or any state securities laws and may not be offered or sold within the United States or to, or for account or benefit of, U.S. Persons (as defined in Regulation S under the 1933 Act) unless registered under the 1933 Act and applicable state securities laws, or an exemption from such registration requirements is available.
About Royal Helium Ltd.
Royal Helium is an exploration, production, and infrastructure company with a primary focus on the development and production of helium and associated gases. The Company controls over 1,000,000 acres of prospective helium permits and leases across southern Saskatchewan and southeastern Alberta. Given the current and foreseeable global undersupplied nature of this critical and non-renewable product, Royal is well positioned to be a leading North American producer of this increasingly high value commodity.
Royal Helium’s helium reservoirs are carried primarily with nitrogen. Nitrogen is not considered a greenhouse gas (GHG) and therefore the plant has a low GHG footprint when compared to plants in other jurisdictions that rely on large scale natural gas production for helium extraction. Helium extracted from wells in Saskatchewan and Alberta can be up to 90% less carbon intensive than helium extraction processes in other jurisdictions.
Andrew Davidson President and Chief Executive Officer Royal Helium Ltd.
CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING INFORMATION
This news release includes certain statements and information that constitute forward-looking information within the meaning of applicable Canadian securities laws. All statements in this news release, other than statements of historical facts are forward-looking statements. Such forward-looking statements and forward-looking information specifically include, but are not limited to, statements that relate to the completion of the Offering and the timing and pricing in respect thereof, the use of proceeds of the Offering, completing the Offering in one or more tranches, and the timely receipt of all necessary approvals, including any requisite approval of the TSX Venture Exchange.
Statements contained in this release that are not historical facts are forward-looking statements that involve various risks and uncertainty affecting the business of the Company. Such statements can generally, but not always, be identified by words such as “expects”, “plans”, “anticipates”, “intends”, “estimates”, “forecasts”, “schedules”, “prepares”, “potential” and similar expressions, or that events or conditions “will”, “would”, “may”, “could” or “should” occur. All statements that describe the Company’s plans relating to operations and potential strategic opportunities are forward-looking statements under applicable securities laws. These statements address future events and conditions and are reliant on assumptions made by the Company’s management, and so involve inherent risks and uncertainties, as disclosed in the Company’s periodic filings with Canadian securities regulators. As a result of these risks and uncertainties, and the assumptions underlying the forward-looking information, actual results could materially differ from those currently projected, and there is no representation by the Company that the actual results realized in the future will be the same in whole or in part as those presented herein. the Company disclaims any intent or obligation to update forward-looking statements or information except as required by law. Readers are referred to the additional information regarding the Company’s business contained in the Company’s reports filed with the securities regulatory authorities in Canada. Although the Company has attempted to identify important factors that could cause actual actions, events, or results to differ materially from those described in forward-looking statements, there may be other factors that could cause actions, events or results not to be as anticipated, estimated or intended. For more information on the Company and the risks and challenges of its business, investors should review the Company’s filings that are available at www.sedarplus.ca.
The Company provides no assurance that forward-looking statements and information will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements or information. Accordingly, readers should not place undue reliance on forward-looking statements or information. The Company does not undertake to update any for-ward looking statements, other than as required by law.
For further information: Please contact the Company: Spiro Kletas, VP Investor Relations, 1 (306) 500-9397, [email protected]; Dean Nawata, Business Development, 1(306) 500-9420, [email protected]
These securities have not been and will not be registered under the United States Securities Act of 1933, as amended (the “U.S. Securities Act”), or the securities laws of any state of the United States, and may not be offered or sold within the United States or to, or for the account or benefit of, U.S. persons or persons in the United States except in compliance with, or pursuant to an available exemption from, the registration requirements of the U.S. Securities Act and applicable U.S. state securities laws. This offering document does not constitute an offer to sell, or the solicitation of an offer to buy, any of these securities within the United States or to, or for the account or benefit of, U.S. persons or persons in the United States. “United States” and “U.S. person” have the meanings ascribed to them in Regulation S under the U.S. Securities Act.
No securities regulatory authority or regulator has assessed the merits of these securities or reviewed this document. Any representation to the contrary is an offence. This offering may not be suitable for you and you should only invest in it if you are willing to risk the loss of your entire investment. In making this investment decision, you should seek the advice of a registered dealer.
November 7, 2023
OFFERING DOCUMENT
UNDER THE LISTED ISSUER FINANCING EXEMPTION
ROYAL HELIUM LTD. (the “Corporation“)
PART 1 SUMMARY OF OFFERING
What are we offering?
Offering:
Units (“Units“) of the Corporation, with each Unit being comprised of one common share in the capital of the Corporation (a “Common Share“) and one Common Share purchase warrant of the Corporation (a “Warrant“). Each Warrant will entitle the holder to purchase one Common Share at an exercise price of $0.31 for a period of 36 months from closing of the offering.
Offering Price:
$0.24 per Unit.
Offering Amount:
Minimum gross proceeds of $3,000,000.
Underwriter:
Research Capital Corporation, as the lead underwriter and sole bookrunner, on behalf of a syndicate of underwriters (collectively, the “Underwriters“).
Closing Date:
On or about the week of November 13, 2023, subject to the approval of the TSX Venture Exchange (the “TSXV“), or such other date as the Underwriters and the Corporation may agree upon.
Exchange:
The Common Shares are listed and posted for trading on the TSXV under the trading symbol “RHC”.
Last Closing Price:
On November 6, 2023, the last trading day prior to the date of this offering document, the closing price of the Common Shares on the TSXV was $0.275.
No securities regulatory authority or regulator has assessed the merits of these securities or reviewed this document. Any representation to the contrary is an offence. This offering may not be suitable for you and you should only invest in it if you are willing to risk the loss of your entire investment. In making this investment decision, you should seek the advice of a registered dealer.
Royal Helium Ltd. is conducting a listed issuer financing under section 5A.2 of National Instrument 45-106 – Prospectus Exemptions. In connection with this offering, the Corporation represents the following is true:
The Corporation has active operations, and its principal asset is not cash, cash equivalents or its exchange listing.
The Corporation has filed all periodic and timely disclosure documents that it is required to have filed.
The total dollar amount of this offering, in combination with the dollar amount of all other offerings made under the listed issuer financing exemption in the 12 months immediately before the date of this offering document, will not exceed $10,000,000 (being 10% of the aggregate market value of the Corporation’s listed securities on the date that the Corporation issued the news release announcing the offering, to a maximum of $10,000,000).
The Corporation will not close this offering unless the issuer reasonably believes it has raised sufficient funds to meet its business objectives and liquidity requirements for a period of 12 months following the distribution.
The Corporation will not allocate the available funds from this offering to an acquisition that is a significant acquisition or restructuring transaction under securities law or to any other transaction for which the issuer seeks security holder approval.
Unless otherwise indicated, all references to “$”, “C$” or “dollars” in this offering document refer to Canadian dollars. References to US$, if any, in this offering document refer to United States dollars.
Unless otherwise indicated or the context otherwise requires, the terms “we”, “us”, “our”, “Royal” and “the Corporation” refer to Royal Helium Ltd., as parent corporation, together with its wholly-owned subsidiaries.
PART 2 SUMMARY DESCRIPTION OF BUSINESS
What is our business?
The Corporation is an exploration, production, and infrastructure company with a primary focus on the development and production of helium and associated gases. The Corporation controls over 1,000,000 acres of prospective helium permits and leases across southern Saskatchewan and southeastern Alberta. Given the current and foreseeable global undersupplied nature of this critical and non-renewable product, the Corporation is well positioned to be a leading North American producer of this increasingly high value commodity.
The Corporation’s helium reservoirs are carried primarily with nitrogen. Nitrogen is not considered a greenhouse gas (“GHG“) and therefore the Corporation’s plant has a low GHG footprint when compared to plants in other jurisdictions that rely on large scale natural gas production for helium extraction. Helium extracted from wells in Saskatchewan and Alberta can be up to 90% less carbon intensive than helium extraction processes in other jurisdictions.
As of December 31, 2022, the Corporation had one employee and relies primarily on consultants to perform necessary activities on behalf of the Corporation.
Further information regarding the Corporation’s business can be found in the Royal’s continuous disclosure documents, which are available under the Corporation’s issuer profile on SEDAR+ at www.sedarplus.ca.
Recent Developments
On June 12, 2023, the closed a “bought deal” private placement of 7,300 non-transferable unsecured convertible debenture units of the Corporation (the “Debenture Units“), at an issue price of $1,000 per Debenture Unit for aggregate gross proceeds of $7,300,000 (the “Bought Deal Offering“). The Bought Deal Offering was increased from the previously announced $7,000,000 as a result of excess demand. The Bought Deal Offering was conducted pursuant to the terms and conditions of an underwriting agreement among the Corporation, Eight Capital, Research Capital Corporation and Cormark Securities Inc. Each Debenture Unit consisted of one 12% unsecured convertible debenture in the principal amount of $1,000 with a maturity date of June 30, 2025 and 2,703 common share purchase warrants entitling the holder thereof to purchase one common share of the Corporation, at an exercise price of $0.40 for a period of 36 months from the closing date of the Bought Deal Offering.
On May 26, 2023, the Corporation announced the appointment of Karl Kurz to the Corporation’s board of directors.
On April 24, 2023, the Corporation announced that it made its first drawdown of $5 million from its $17.5 million non-revolving facility (the “Credit Facility“) provided by Canadian Western Bank (“CWB“) and the Business Development Bank of Canada (“BDC“). The Credit Facility was established through binding commitment letters signed by the Corporation with CWB and BDC, which was announced by the Corporation on February 6, 2023. The final indenture agreements have been signed by all counterparties. The proceeds of the Credit Facility will be used for the development and construction of production facilities currently under construction for the Corporation’s Steveville helium field in southern Alberta, Canada.
On January 10, 2023, the Corporation closed a bought deal private placement of 5,500 non-transferable subscription receipts (each a “Subscription Receipt“) for aggregate gross proceeds of $5.5 million, representing an issue price of
$1,000 per Subscription Receipt. Under the terms of the private placement, each Subscription Receipt converted into one 14% unsecured convertible debenture unit of the Corporation, upon the completion of certain escrow release conditions. Following the receipt of the commitment letters in connection with the Credit Facility, the remaining conditions were waived by the debenture holders to release from escrow the aggregate gross proceeds of the private placement.
Material facts
There are no material facts about the securities being distributed that have not been disclosed in this offering document or in any other document filed by the Corporation in the 12 months preceding the date of this offering document.
What are the business objectives that we expect to accomplish using the available funds?
The Corporation intends to use the net proceeds from this offering, together with the Corporation’s current working capital, for the following purposes in order to meet the business objectives described below:
Business Objectives and Milestones
Target Date for Completion
Project Costs ($)
Design and engineering for offtake gas facilities
Q4 2023
$1,000,000
Well completions
Q1 2024
$1,500,000
General and administrative expenses (working capital)
Q4 2023/Q1 2024
$500,000
If the Corporation exceeds the minimum offering, any additional net proceeds from this offering will be unallocated working capital.
PART 3 USE OF AVAILABLE FUNDS
What will our available funds be upon the closing of the offering?
Based on the Corporation’s existing working capital deficiency of $5,072,250 and the size of this offering of $3,000,000 ($3,450,000 if the over-allotment is exercised in full), the expected availability of funds is a minimum of $1,913,852 and a maximum of $2,336,852.
The following table discloses information regarding the Corporation’s available funds after completion of the offering.
The following table provides a breakdown of how the Corporation intends to use the available funds described in the table above.
Description of intended use of available funds, listed in order of priority
Assuming minimum offering only
Assuming exercise of over-allotment option
Design and engineering for Offtake Gas Facilities
$1,000,000
$1,000,000
Multi-well completion at Val Marie
$750,000
$750,000
Multi-well completion at Ogema
$500,000
$500,000
Multi-well completion at Steveille
$250,000
$250,000
General corporate and administration costs
Nil
Nil
Unallocated general working capital
$1,913,852
$2,336,852
Total (equal to G in the Available Funds table above)
$4,413,852
$4,836,852
The above noted allocation and anticipated timing represents the Corporation’s current intentions with respect to its use of proceeds based on current knowledge, planning and expectations of management of the Corporation. Although the Corporation intends to expend the proceeds from this offering as set forth above, there may be circumstances where, for sound business reasons, a reallocation of funds may be deemed prudent or necessary and may vary materially from that set forth above, as the amounts actually allocated and spent will depend on a number of factors, including the Corporation’s ability to execute on its business plan and sustain its operations for not less than 12 months from the closing date of this offering.
How have we used the other funds we have raised in the past 12 months?
The Corporation has used the funds it has raised over the past 12 months as follows:
Previous Financing
Intended Use of Funds
Actual Use of Funds
Variance and Impact on Business Objectives and Milestones
June 12, 2023, the Corporation closed a “bought deal” private placement of 7,300 non- transferable debenture units at an issue price of $1,000 per debenture unit for aggregate gross proceeds of $7,300,000
Funding of capital expenditures related to the Corporation’s Steveville production facilities
Funding of capital expenditures related to the Corporation’s Steveville production facilities
No variance
April 24, 2023, the Corporation made its first drawdown of $5 million from its $17.5 million debt facility provided by Canadian Western Bank and the Business Development Bank of Canada
The development of the Corporation’s Steveville production facilities
The development of the Corporation’s Steveville production facilities
No variance
January 10, 2023, the Corporation closed a “bought deal” private placement of 5,500 non- transferable subscription receipts at an issue price of $1,000 per subscription receipt for aggregate gross proceeds of $5,500,000
Funding of capital expenditures related to the Corporation’s Steveville production facilities and for general corporate purposes
Funding of capital expenditures related to the Corporation’s Steveville production facilities and for general corporate purposes
No variance
PART 4 FEES AND COMMISSIONS
Who are the dealers or finders that we have engaged in connection with this offering, if any, and what are their fees?
Underwriters:
Research Capital Corporation, as lead underwriter and sole bookrunner, on behalf of a syndicate of underwriters
Compensation Type:
Cash commission and non-transferable warrants in an amount equal to 6% of the number of Units in connection with the offering (the “Broker Warrants“) entitling the holder thereof to purchase one Unit at an exercise price equal to the price of each Unit
Cash Commission:
6% of the gross proceeds of the offering
Broker Warrants:
6% of the number of Units sold in the offering
Does Research Capital Corporation have a conflict of interest?
To the knowledge of the Corporation, the Underwriters are not a “related issuer” or “connected issuer” of or to the Corporation, as those terms are defined in National Instrument 33-105 – Underwriting Conflicts.
PART 5 PURCHASERS’ RIGHTS
Rights of Action in the Event of a Misrepresentation
If there is a misrepresentation in this offering document, you have a right
(a) to rescind your purchase of these securities with the Corporation, or
(b) to damages against the Corporation and may, in certain jurisdictions, have a statutory right to damages from other persons.
These rights are available to you whether or not you relied on the misrepresentation. However, there are various circumstances that limit your rights. In particular, your rights might be limited if you knew of the misrepresentation when you purchased the securities.
If you intend to rely on the rights described in paragraph (a) or (b) above, you must do so within strict time limitations.
You should refer to any applicable provisions of the securities legislation of your province or territory for the particulars of these rights or consult with a legal adviser.
PART 6 ADDITIONAL INFORMATION
Where can you find more information about us?
Prospective investors and security holders can access the Corporation’s continuous disclosure under the Corporation’s issuer profile on SEDAR+ at www.sedarplus.ca and on the Corporation’s website at www.royalheliumltd.com.
Please also refer to Appendix A – Acknowledgements, Covenants, Representations and Warranties of the Investorand Appendix B – Indirect Collection of Personal Informationattached hereto for important information regarding any purchase of Units under the offering.
U.S. Securities Law Matters
The Common Shares and Warrants comprising the Units being offered in the offering have not been and will not be registered under the U.S. Securities Act or the securities laws of any state of the United States, and may not be offered or sold within the United States or to, or for the account or benefit of, U.S. persons or persons in the United States except in compliance with, or pursuant to an available exemption from, the registration requirements of the U.S. Securities Act and applicable U.S. state securities laws. This offering document does not constitute an offer to sell, or the solicitation of an offer to buy, any of these securities within the United States or to, or for the account or benefit of, U.S. persons or persons in the United States. “United States” and “U.S. person” have the meanings ascribed to them in Regulation S under the U.S. Securities Act.
CERTIFICATE OF THE CORPORATION
This offering document, together with any document filed under Canadian securities legislation on or after November 7, 2022, contains disclosure of all material facts about the securities being distributed and does not contain a misrepresentation.
DATE: November 7, 2023
ROYAL HELIUM LTD.
Per:
(signed) “Andrew Davidson” Andrew Davidson President and Chief Executive Officer
ACKNOWLEDGEMENTS, COVENANTS, REPRESENTATIONS AND WARRANTIES OF THE INVESTOR
Each purchaser of the Units (the “Investor“) makes, and is deemed to make, the following acknowledgements, covenants, representations and warranties to the Corporation and the Underwriters, as at the date hereof, and as of the closing date:
(a) the Investor (i) has such knowledge and experience in financial and business affairs as to be capable of evaluating the merits and risks of its investment in the Units (including the potential loss of its entire investment); (ii) is aware of the characteristics of the Units and understands the risks relating to an investment therein; and (iii) is able to bear the economic risk of loss of its investment in the Units and understands that it may lose its entire investment in the Units;
(b) the Investor is resident in the jurisdiction disclosed to the Underwriters or the Corporation and the Investor was solicited to purchase in such jurisdiction;
(c) the subscription for the Units by the Investor does not contravene any of the applicable securities legislation in the jurisdiction in which the Investor resides and does not give rise to any obligation of the Corporation to prepare and file a prospectus, registration statement or similar document or to register the Units or to be registered with or to file any report or notice with any governmental or regulatory authority, other than standard post-closing filings required to be made in Canada and the United States for offerings exempt from the registration requirements;
(d) unless the Investor has separately delivered to the Corporation and the Underwriters a U.S. Representation Letter (in which case the Investor makes the representations, warranties and covenants set forth therein), the Investor (i) is not in the United States, its territories or possessions, any State of the United States or the District of Columbia (collectively, the “United States”), (ii) was outside of the United States at the time the buy order for the Units was originated, (iii) is not subscribing for the Units for the account of a person in the United States, (iv) is not subscribing for the Units for resale in the United States, and (v) was not offered the Units in the United States;
(e) the Investor is aware that the Units have not been and will not be registered under the United States Securities Act of 1933 (the “U.S. Securities Act”) or the securities laws of any state of the United States and that the Units may not be offered, sold or otherwise disposed of, directly or indirectly, in the United States, any state or territory of the United States or the District of Columbia, without registration under the U.S. Securities Act and all applicable state securities laws or compliance with the requirements of an exemption from such registration and it acknowledges that the Corporation has no obligation or present intention of filing a registration statement under the U.S. Securities Act in respect of the sale or resale of the Units;
(f) the funds representing the aggregate subscription funds which will be advanced by the Investor to the Corporation hereunder, as applicable, will not represent proceeds of crime for the purposes of the Proceeds of Crime (Money Laundering) and Terrorist Financing Act (Canada) (the “PCMLTFA“) or for the purposes of the United States Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act, as may be amended from time to time (the “PATRIOT Act“) and the Investor acknowledges that the Corporation may in the future be required by law to disclose the Investor’s name and other information relating to the Investor’s subscription of the Units, on a confidential basis, pursuant to the PCMLTFA and the PATRIOT Act, and that, to the best of its knowledge: (i) none of the subscription funds to be provided by the Investor (A) have been or will be derived from or related to any activity that is deemed criminal under the laws of Canada, the United States or any other jurisdiction; or (B) are being tendered on behalf of a person who has not been identified to the Investor; and (ii) it will promptly notify the Corporation if the Investor discovers that any of such representations ceases to be true, and to provide the Corporation with appropriate information in connection therewith;
(g) neither the Corporation, the Underwriters, nor any of their respective directors, employees, officers, affiliates or agents has made any written or oral representations to the Investor: (i) that any person will resell or repurchase the Units; (ii) that any person will refund all or any part of the subscription amount; or (iii) as to the future price or value of the Units;
(h) the Investor is not purchasing the Units with knowledge of any material information concerning the Corporation that has not been generally disclosed;
(i) the Investor’s Units are not being purchased by the Investor as a result of, nor does the Investor, if any, have knowledge of, any ‘material fact’ or ‘material change’, as those terms are defined in securities laws of the jurisdiction in which the Investor is resident or to which the Investor is subject (“Securities Laws“), concerning the Corporation that has not been generally disclosed, and the decision of the Investor to subscribe for and purchase Units has not been made as a result of any oral or written representation as to fact or otherwise made by, or on behalf of, the Corporation or any other person and is based entirely upon the offering document;
(j) no securities commission, agency, governmental authority, regulatory body, stock exchange or other regulatory body has reviewed or passed on the investment merits of the Units and there is no government or other insurance covering the Units;
(k) if required by applicable Securities Laws or the Corporation, the Investor will execute, deliver and file or assist the Corporation in filing such reports, undertakings and other documents with respect to the issue and/or sale of the Units as may be required by any securities commission, stock exchange or other regulatory authority;
(l) the Corporation is relying on an exemption from the requirement to provide the Investor with a prospectus or registration statement under the Securities Laws and, as a consequence of acquiring the Units pursuant to such exemption, the Investor may not receive information that would otherwise be required to be given under the Securities Laws;
(m) if the Investor is:
(i) a corporation, the Investor is duly incorporated and is validly subsisting under the laws of its jurisdiction of incorporation and has all requisite legal and corporate power and authority to subscribe for the Units as contemplated herein and to carry out and perform its obligations under the terms of this offering document;
(ii) a partnership, syndicate or other form of unincorporated organization, the Investor has the necessary legal capacity and authority to observe and perform its covenants and obligations under this offering document and has obtained all necessary approvals in respect thereof; or
(iii) an individual, the Investor is of the full age of majority and is legally competent to observe and perform his or her covenants and obligations under this offering document;
(n) the Investor is responsible for obtaining such legal and tax advice as it considers appropriate in connection with the performance of this offering document and the transactions contemplated under this offering document, and that the Investor is not relying on legal or tax advice provided by the Corporation or its counsel;
(o) the performance and compliance with the terms of this offering document, the subscription for the Units and the completion of the transactions described herein by the Investor will not result in any material breach of, or be in conflict with or constitute a material default under, or create a state of facts which, after notice or lapse of time, or both, would constitute a material default under any term or provision of the constating documents, bylaws or resolutions of the Investor if the Investor is not an individual, the Securities Laws or any other laws applicable to the Investor, any agreement to which the Investor is a party, or any judgment, decree, order, statute, rule or regulation applicable to the Investor;
(p) the Investor has obtained all necessary consents and authorities to enable it to agree to subscribe for the Units and to perform its obligations under this offering document and the Investor has otherwise observed all applicable laws, obtained any requisite governmental or other consents, complied with all requisite formalities and paid any issue, transfer or other taxes due in any territory in connection with its acceptance and the Investor has not taken any action which will or may result in the Corporation acting in breach of any regulatory or legal requirements of any territory in connection with the Offering or the Investor’s subscription;
(q) where required by law, the Investor is either purchasing the Units as principal for its own account and not as agent or trustee for the benefit of another or is deemed to be purchasing the Units as principal for its own account in accordance with applicable Securities Laws;
(r) the Investor is purchasing the Units for investment purposes only and not with a view to resale or distribution;
(s) (i) neither the Investor, nor any beneficial purchaser, if any, nor any Subscriber Beneficial Owner (as defined below) has been subject to or experienced any event or circumstance described in Rule 506(d)(1)(i) through (viii) of Regulation D (“Regulation D“) under the U.S. Securities Act, (ii) neither the Investor, nor any beneficial purchaser, if any, nor any Subscriber Beneficial Owner has been subject to any order, judgment, or decree of any court of competent jurisdiction temporarily, preliminary or permanently enjoining such person for failure to comply with Rule 503 of Regulation D, and (iii) if at any time the Investor, any beneficial purchaser, if any, or any Subscriber Beneficial Owner is deemed, directly or indirectly, to be the beneficial owner of ten percent (10%) or more of the Corporation’s outstanding voting equity securities as calculated under Rule 13d-3 under the United States Securities Exchange Act of 1934, as amended, the Investor or the beneficial purchaser (as applicable) will immediately notify the Corporation if the Investor, any beneficial purchaser, or a Subscriber Beneficial Owner becomes subject to or experiences any of the events or circumstances listed in Rule 506(d)(1)(i) through (viii) of Regulation D (or any successor thereto or expansion thereof) or becomes subject to any order, judgment, or decree of any court of competent jurisdiction temporarily, preliminary or permanently enjoining such person for failure to comply with Rule 503 of Regulation D. The Investor has exercised, and will exercise, reasonable care to determine whether any beneficial purchaser and Subscriber Beneficial Owner is subject to any of the events or circumstances described in this paragraph. For these purposes, “Subscriber Beneficial Owner” means any person who through the Investor or the beneficial purchaser (if applicable) would be deemed, directly or indirectly, to be the beneficial owner of ten percent (10%) or more of the Corporation’s outstanding voting equity securities as calculated under Rule 13d-3 under the United States Securities Exchange Act of 1934, as amended; and
(t) certain fees and commissions may be payable by the Corporation in connection with the offering.
APPENDIX B
INDIRECT COLLECTION OF PERSONAL INFORMATION
By purchasing Units, the Investor acknowledges that the Corporation and the Underwriters and their respective agents and advisers may each collect, use and disclose its name and other specified personally identifiable information (including its name, jurisdiction of residence, address, telephone number, email address and aggregate value of the Units that it has purchased) (the “Information“), for purposes of (i) meeting legal, regulatory, stock exchange and audit requirements and as otherwise permitted or required by law or regulation, and (ii) issuing ownership statements issued under a direct registration system or other electronic book-entry system, or certificates that may be issued, as applicable, representing the Units to be issued to the Investor. The Information may also be disclosed by the Corporation to: (i) stock exchanges, (ii) revenue or taxing authorities and (iii) any of the other parties involved in the offering, including legal counsel, and may be included in record books in connection with the offering. The Investor is deemed to be consenting to the disclosure of the Information.
By purchasing the Units, the Investor acknowledges (A) that the Information concerning the Investor will be disclosed to applicable Canadian securities regulatory authorities and may become available to the public in accordance with the requirements of applicable securities and freedom of information laws and the Investor consents to the disclosure of the Information; (B) the Information is being collected indirectly by the applicable Canadian securities regulatory authorities under the authority granted to them in securities legislation; and (C) the Information is being collected for the purposes of the administration and enforcement of the applicable Canadian securities legislation; and by purchasing the Units, the Investor shall be deemed to have authorized such indirect collection of personal information by the relevant Canadian securities regulatory authorities.
The Investor may contact the following public official in the applicable province with respect to questions about the commission’s indirect collection of such Information at the following address, telephone number and email address (if any):
Alberta Securities Commission Suite 600, 250 – 5th Street SW Calgary, Alberta T2P 0R4 Telephone: 403 297-6454 Toll free in Canada: 1 877 355-0585 Facsimile: 403 297-2082
British Columbia Securities Commission P.O. Box 10142, Pacific Centre 701 West Georgia Street Vancouver, British Columbia V7Y 1L2 Inquiries: 604 899-6854 Toll free in Canada: 1 800 373-6393 Facsimile: 604 899-6581 Email: [email protected]
Financial and Consumer Services Commission (New Brunswick) 85 Charlotte Street, Suite 300 Saint John, NB E2L 2J2 Toll free in Canada: 1 866 933-2222 Email: [email protected]
Manitoba Securities Commission 500-400 St. Mary Avenue Winnipeg MB R3C 4K5 Telephone: 204 945-2548 Toll Free in Manitoba: 800 655-5244 Fax: 204 945-0330 Email: [email protected]
Ontario Securities Commission 20 Queen Street West, 22nd Floor Toronto, Ontario M5H 3S8 Telephone: 416 593- 8314 Toll free in Canada: 1 877 785-1555 Facsimile: 416 593-8122 Email: [email protected] Public official contact regarding indirect collection of information: Inquiries Officer
Nova Scotia Securities Commission Ste. 400, Duke Tower, 5251 Duke St. Halifax, NS B3J 1P3 Telephone: 902 424-7768 Toll Free Number (within Nova Scotia): 1 855 424-2499 Fax: 902 424-4625 Email: [email protected]
Prince Edward Island Office of the Superintendent of Securities Office of the Superintendent of Securities Financial and Consumer Services Division 95 Rochford Street, P. O. Box 2000 Charlottetown, PEI, C1A 7N8 Telephone: 902 620-3870 Fax: 902 368-5283
Service NL (Newfoundland and Labrador Securities Regulation) Digital Government and Service NL 100 Prince Phillip Drive, P.O. Box 8700 St. John’s, NL A1B 4J6 Telephone: 1 709 729-4834 Email: [email protected]
Royal Helium Ltd. (TSXV: RHC) (OTCQB: RHCCF) (“Royal” or the “Company”) is pleased to announce that it has commenced an overnight marketed offering (the “Offering”) of units of the Company (each, a “Unit”) at a price of $0.24 per Unit for aggregate gross proceeds of $3,000,000.
Each Unit shall be comprised of one common share of the Company (a “Common Share”) and one purchase warrant of the Company (a “Warrant”). Each Warrant shall entitle the holder thereof to purchase one Common Share at an exercise price of $0.31 for a period of 36 months from the closing of the Offering.
The Offering is being led by Research Capital Corporation as the lead underwriter and sole bookrunner, on behalf of a syndicate of underwriters (the “Underwriters”). The Company has granted the Underwriters an option (the “Underwriters’ Option”) to increase the size of the Offering by up to 15% of the number of Units by giving written notice of the exercise of the Underwriters’ Option, or a part thereof, to the Company at any time up to 48 hours prior to the closing of the Offering.
The net proceeds from the Offering will be used for multi-well completions at Val Marie, Ogema and Steveville, design and engineering for offtake gas facilities, and for working capital and general corporate purposes.
The Offering is anticipated to close on or about the week of November 13, 2023 (“Closing”), or such later date as the Company and the Underwriters may determine. The Closing is subject to certain conditions including, but not limited to, the receipt of all necessary regulatory and other approvals, including the approval of the TSX Venture Exchange.
The Offering will be conducted pursuant to the amendments to National Instrument 45-106 – Prospectus Exemptions (“NI 45-106”) set forth in Part 5A thereof (the “Listed Issuer Financing Exemption”) to purchasers resident in Canada, except Québec, and/or other qualifying jurisdictions. The Units offered under the Listed Issuer Financing Exemption will not be subject to resale restrictions pursuant to applicable Canadian securities laws. The Offering may be conducted in the United States pursuant to exemptions from the registration requirements under Rule 144A and/or Regulation D of the United States Securities Act of 1933, as amended (the “1933 Act“), subject to receipt of all necessary regulatory approvals, and in those other jurisdictions outside of Canada and the United States provided it is understood that no prospectus filing or comparable obligation arises in such other jurisdiction.
There is an offering document related to the Offering that can be accessed under the Company’s profile at www.sedarplus.ca and on the Company’s website at https://royalheliumltd.com/. Prospective investors should read this offering document before making an investment decision.
This news release does not constitute an offer to sell or a solicitation of an offer to buy nor shall there be any sale of any of the securities in any jurisdiction in which such offer, solicitation or sale would be unlawful, including any of the securities in the United States of America. The securities described herein have not been and will not be registered under the 1933 Act or any state securities laws and may not be offered or sold within the United States or to, or for account or benefit of, U.S. Persons (as defined in Regulation S under the 1933 Act) unless registered under the 1933 Act and applicable state securities laws, or an exemption from such registration requirements is available.
About Royal Helium Ltd.
Royal Helium is an exploration, production, and infrastructure company with a primary focus on the development and production of helium and associated gases. The Company controls over 1,000,000 acres of prospective helium permits and leases across southern Saskatchewan and southeastern Alberta. Given the current and foreseeable global undersupplied nature of this critical and non-renewable product, Royal is well positioned to be a leading North American producer of this increasingly high value commodity.
Royal Helium’s helium reservoirs are carried primarily with nitrogen. Nitrogen is not considered a greenhouse gas (GHG) and therefore the plant has a low GHG footprint when compared to plants in other jurisdictions that rely on large scale natural gas production for helium extraction. Helium extracted from wells in Saskatchewan and Alberta can be up to 90% less carbon intensive than helium extraction processes in other jurisdictions.
Andrew Davidson President and Chief Executive Officer Royal Helium Ltd.
CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING INFORMATION
This news release includes certain statements and information that constitute forward-looking information within the meaning of applicable Canadian securities laws. All statements in this news release, other than statements of historical facts are forward-looking statements. Such forward- looking statements and forward-looking information specifically include, but are not limited to, statements that relate to the completion of the Offering and the timing and pricing in respect thereof, the use of proceeds of the Offering, the timely receipt of all necessary approvals, including any requisite approval of the TSX Venture Exchange.
Statements contained in this release that are not historical facts are forward-looking statements that involve various risks and uncertainty affecting the business of the Company. Such statements can generally, but not always, be identified by words such as “expects”, “plans”, “anticipates”, “intends”, “estimates”, “forecasts”, “schedules”, “prepares”, “potential” and similar expressions, or that events or conditions “will”, “would”, “may”, “could” or “should” occur. All statements that describe the Company’s plans relating to operations and potential strategic opportunities are forward-looking statements under applicable securities laws. These statements address future events and conditions and are reliant on assumptions made by the Company’s management, and so involve inherent risks and uncertainties, as disclosed in the Company’s periodic filings with Canadian securities regulators. As a result of these risks and uncertainties, and the assumptions underlying the forward-looking information, actual results could materially differ from those currently projected, and there is no representation by the Company that the actual results realized in the future will be the same in whole or in part as those presented herein. the Company disclaims any intent or obligation to update forward-looking statements or information except as required by law. Readers are referred to the additional information regarding the Company’s business contained in the Company’s reports filed with the securities regulatory authorities in Canada. Although the Company has attempted to identify important factors that could cause actual actions, events, or results to differ materially from those described in forward-looking statements, there may be other factors that could cause actions, events or results not to be as anticipated, estimated or intended. For more information on the Company and the risks and challenges of its business, investors should review the Company’s filings that are available at www.sedarplus.ca.
The Company provides no assurance that forward-looking statements and information will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements or information. Accordingly, readers should not place undue reliance on forward-looking statements or information. The Company does not undertake to update any for- ward looking statements, other than as required by law.
Royal Helium Ltd. (TSXV: RHC) (OTCQB: RHCCF) (“Royal Helium” or the “Company“) is pleased to announce that the Company has commenced loading purified helium into specialized ISO trailers at its Steveville helium purification facility, marking the start of commercial sales from its facility located in Southeastern Alberta.
“As we prepare our flagship delivery, the Company is proud to be entering into this new and exciting phase of our business, making Royal Helium one of the leading, active suppliers of purified helium directly to end-users” said President and CEO Andrew Davidson.
Volumes from this first facility commences fulfillment of the Company’s offtake agreement with its major North American aerospace customer, which has contracted to purchase Steveville facility volumes over the next several years. These existing offtake agreements, established over the past two years, deliver volumes at an average price that exceeds USD $500 per mcf. Given the increasing demand for purified helium combined with the current geopolitical backdrop further constraining supply of key resources, Royal Helium anticipates a robust pricing environment for the foreseeable future.
Royal Helium’s high margin production activities and corresponding operating cash flow will be supportive of the Company’s plans to add several additional purification facilities in the upcoming calendar year. The Company is in discussions with numerous parties interested in establishing offtake agreements relating to its forthcoming facilities. Royal Helium looks forward to establishing additional, strong and long-term relationships with key industry players who require helium in support of critical industries, including healthcare, chip manufacturing, aerospace, and others.
About the Steveville Helium Purification Plant
Royal Helium’s 100% owned state-of-the-art purification facility was purpose built to recover 99.999% helium while setting the highest standards for environmental efficiencies and to produce an exceptionally low carbon footprint. Substantially all of the gas purified at the facility is inert and can be captured in purified form at the facility, providing additional potential cash flow streams. Until the byproduct gases are captured and sold, they are vented with virtually zero impact to the environment, given the gas’s completely inert nature. The limited ancillary methane gas produced is recycled back into the facility to power its own operations, with the ability to generate excess power which may be distributed back into the electrical grid, providing additional economics to Royal Helium.
The Steveville plant will benefit from carbon credits generated under the Technology Innovation and Emissions Reduction System (“TIER system”) in Alberta. As these carbon credits are monetized, they have the ability to provide Royal Helium with a material additional cash flow stream.
About Royal Helium Ltd.
Royal Helium is an exploration, production, and infrastructure company with a primary focus on the development and production of helium and associated gases. The Company controls over 1,000,000 acres of prospective helium permits and leases across southern Saskatchewan and southeastern Alberta. Given the current and foreseeable global undersupplied nature of this critical and non-renewable product, Royal is well positioned to be a leading North American producer of this increasingly high value commodity.
Royal Helium’s helium reservoirs are carried primarily with nitrogen. Nitrogen is not considered a greenhouse gas (GHG) and therefore the plant has a low GHG footprint when compared to plants in other jurisdictions that rely on large scale natural gas production for helium extraction. Helium extracted from wells in Saskatchewan and Alberta can be up to 90% less carbon intensive than helium extraction processes in other jurisdictions.
Andrew Davidson President and Chief Executive Officer Royal Helium Ltd.
CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING INFORMATION
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this news release.
This news release includes certain statements that may be deemed to be “forward-looking statements”. All statements in news this release, other than statements of historical facts, that address events or developments that management of the Company expects, are forward-looking statements. Although management believes the expectations expressed in such forward-looking statements are based on reasonable assumptions, such statements are not guarantees of future performance, and actual results or developments may differ materially from those in the forward-looking statements. The Company undertakes no obligation to update these forward-looking statements if management’s beliefs, estimates or opinions, or other factors, should change. Factors that could cause actual results to differ materially from those in forward-looking statements, include market prices, exploration and development successes, continued availability of capital and financing, and general economic, market or business conditions. Please see the public filings of the Company at www.sedar.com for further information.
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