Hercules Resources issues 789,583 shares for debt

Executive Summary

• Hercules Resources Corp. completed a share‑for‑debt transaction, extinguishing $236,875 of outstanding indebtedness.
• The settlement was effected by issuing 789,583 common shares at C$0.30 per share to three creditors, including CEO Michael Smith and CFO‑controlled Kingfisher Consulting Ltd.
• The transaction is a related‑party deal but qualifies for exemptions under MI 61‑101; independent directors approved the settlement and no recipient now holds >10 % of outstanding shares.

Key Details

• Debt extinguished: $236,875 total outstanding indebtedness.
• Shares issued: 789,583 common shares at C$0.30 per share (aggregate gross consideration of ≈C$236,875).
• Creditor allocation: Shares were allocated to:
• Michael Smith – CEO and director (related party).
• Equitas Capital Corp. – arm’s‑length consultant (consultancy exemption applied).
• Kingfisher Consulting Ltd. – controlled by the CFO (related party).
• Related‑party considerations: Transaction falls under MI 61‑101 exemptions because:
• Fair market value of consideration ≤25 % of market capitalization.
• No single creditor receives >10 % of issued and outstanding shares post‑settlement.
• Governance: Independent directors reviewed and approved the settlement; hold period imposed on shares issued to Mr. Smith and Kingfisher Consulting per CSE policy.
• Exemptions used:
• Valuation exemption (section 5.5(a)).
• Minority shareholder approval exemption (section 5.7(1)(a)).

Notable Quotes

(No direct quotes were provided in the release.)