Royal Helium Ltd. Files for Creditor Protection

Rhea-AI Summary

Royal Helium (TSXV: RHC) (OTCQB: RHCCF) and its subsidiaries have filed for creditor protection under the Bankruptcy and Insolvency Act (BIA). The company had been seeking an out-of-court restructuring solution, including attempts to raise capital for working capital needs, creditor obligations, and re-commissioning of the Steveville Helium Facility.

The BIA filing includes a stay of proceedings and the appointment of Doane Grant Thornton LLP as proposal trustee. The company will work with the trustee to streamline operations and conduct a Court-supervised sales process to maximize asset value for stakeholders. The board of directors will remain in place, with management continuing day-to-day operations under trustee oversight.

The company faces potential delisting review by TSX Venture Exchange. Additionally, the company's VP of Geology and acting COO, Shayne Neigum, has resigned to pursue other opportunities.

Positive

• None.

Negative

• Filed for bankruptcy protection under BIA
• Failed to secure out-of-court restructuring solution
• Insufficient working capital to meet obligations
• VP of Geology/COO resigned
• Faces potential delisting from TSXV
• Steveville Helium Facility requires re-commissioning

Toronto, Ontario--(Newsfile Corp. - January 20, 2025) - Royal Helium Ltd. (TSXV: RHC) (OTCQB: RHCCF) ("Royal") announced today that Royal and its subsidiaries, Royal Helium Exploration Limited and Imperial Helium Corp. (together with Royal, the "Company"), filed a notice of intention to make a proposal under the Bankruptcy and Insolvency Act (the "BIA").

The Company has been actively pursuing an out-of-court restructuring solution, which included, among other things, initiatives to raise additional capital to meet working capital needs, creditor obligations and fund engineering requirements to appropriately re-commission the Steveville Helium Facility. Following such review and after careful consideration of all available alternatives, and consultation with counsel, the board of directors of the Company determined that it is in the best interests of the Company and its stakeholders to file for protection under the BIA.

The filing under the BIA includes, among other things: (i) a stay of proceedings in favour of the Company, and (ii) the appointment of Doane Grant Thornton LLP as the proposal trustee of the Company (in such capacity, the "Trustee").

The Company sought creditor protection under the BIA in order to obtain a stay of proceedings that will allow the Company to work with the Trustee to facilitate the development of an orderly process designed to streamline its interim administrative and operational needs and conduct a Court-supervised sales process to obtain a going concern solution for its operations and maximize the value of the Company's assets for the benefit of its stakeholders.

The board of directors of the Company will remain in place and management will remain responsible for the day-to-day operations of the Company, under the general oversight of the Proposal Trustee.

It is anticipated that TSX Venture Exchange (the "TSXV") will place the Company under delisting review and there can be no assurance as to the outcome of such review or the continued qualification for listing on the TSXV.

Other Recent Events:

As the Company has been working toward a restructuring solution, the Company's VP of Geology (Shayne Neigum), who had also been acting in the capacity of its COO resigned from the Company to pursue other opportunities. The Company expresses its appreciation for Shayne's contributions to the business and wishes him the best in his future activities.

About Royal Helium Ltd.

Royal is an exploration, production and infrastructure company with a primary focus on the development of helium and associated gases. The Company's extensive footprint includes prospective helium permits and leases across Southern Saskatchewan and southeastern Alberta.

Royal's helium reservoirs are carried primarily with nitrogen. Nitrogen is not considered a greenhouse gas (GHG) and therefore has a low GHG footprint when compared to 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. For more information, please visit SEDAR+ (www.sedarplus.ca) and the Company's website (https://royalheliumltd.com).

Forward-Looking Statements

This news release includes certain statements that may be deemed to be "forward-looking statements." All statements in this news release, other than statements of historical facts, that address events or developments that management of the Company expects, are forward-looking statements, including, the statements relating to the Company's continued listing on the TSXV, and other statements that are not historical facts. 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 on the risks and uncertainties associated with the Company's business. Readers should not place undue reliance on forward-looking information and statements, which speak only as of the date made. The forward-looking information and statements contained in this release represent our expectations as of the date of this release. The Company disclaims any intention or obligation or undertaking to update or revise any forward-looking information or statements whether as a result of new information, future events or otherwise, except as required under applicable securities laws

Neither the TSXV nor its Regulation Services Provider (as that term is defined in the policies of the TSXV) accepts responsibility for the adequacy or accuracy of this news release.

For further information:
Royal Helium Ltd.
David Young, CEO
Email: info@royalheliumltd.com

Doane Grant Thornton LLP
Dan Wootton, Trustee
Phone: +1 416 360 3063
Email: Dan.Wootton@doane.gt.ca

To view the source version of this press release, please visit https://www.newsfilecorp.com/release/237832

FAQ

What are the implications of Royal Helium (RHCCF) filing for creditor protection?

The filing provides a stay of proceedings, allowing the company to work with a trustee to streamline operations and conduct a Court-supervised sales process while maximizing asset value for stakeholders.

Will Royal Helium (RHCCF) continue trading on the TSXV after filing for bankruptcy protection?

The company faces a delisting review by the TSX Venture Exchange, and there is no assurance of continued listing qualification.

What happens to Royal Helium's (RHCCF) management after the BIA filing?

The board of directors will remain in place, and management will continue day-to-day operations under the oversight of the Proposal Trustee, Doane Grant Thornton LLP.

What led to Royal Helium's (RHCCF) bankruptcy protection filing in January 2025?

The company faced working capital shortages, creditor obligations, and needed funds to re-commission the Steveville Helium Facility, while failing to secure an out-of-court restructuring solution.