Hillcrest Energy closes first tranche of offering

Executive Summary

• Hillcrest Energy Technologies Ltd. has closed the first tranche of its unit offering, raising gross proceeds of $2,656,758.
• The proceeds were generated through a combination of cash private placement ($764,650) and the settlement of $1,892,108 in debt owed to arm's-length creditors.
• The company issued 29,519,536 units, each consisting of one common share and one common share purchase warrant, with proceeds designated for ZVS technology development, marketing, and working capital.

Key Details

• Gross Proceeds: $2,656,758 total.
• Cash Component: $764,650 raised via private placement.
• Debt Settlement Component: $1,892,108 raised by issuing units to settle debt owed to arm's-length creditors.
• Units Issued: 29,519,536 units total.
• Price Per Unit: $0.09.
• Security Composition: Each unit consists of one common share and one common share purchase warrant.
• Total Common Shares Issued: 29,519,536.
• Total Warrants Issued: 29,519,536.
• Warrant Terms:
  • Exercise Price: $0.12 per common share.
  • Duration: 24 months from issuance.
  • Accelerated Expiry: Triggered if common shares trade at a VWAP of at least $0.36 for 10 consecutive trading days, with notice given 30 business days prior.
• Use of Proceeds: Further development of ZVS technology, marketing to potential customers, investor relations, retirement of existing accounts payable, and general working capital.
• Strategic Context: The offering supports the commercialization of Hillcrest's ZVS technology, following an MOU with Pasqua First Nation (PFN) and a letter agreement with Apeiron Resources Ltd.
• Future Tranche: PFN may invest up to $3 million directly into Hillcrest through a second tranche, which may also include additional investors and debt settlements.
• Regulatory Status: The second tranche is expected to trigger securityholder approval requirements (>100% of outstanding securities) but the company relies on the financial difficulties exemption under CSE Policy 4, determined by the independent audit committee.
• Hold Period: Securities are subject to a statutory four-month-and-one-day hold period.

Notable Quotes

• "This financing strengthens Hillcrest's financial health by retiring debt and providing fresh capital for the company's continued technology development and general operations," said Don Currie, chief executive officer of Hillcrest Energy Technologies. "This puts Hillcrest in a much stronger position to execute on our business objectives and deliver value to our shareholders."