Barksdale Closes the Convertible Debentures Offering and Extended Maturity Date of Existing Convertible Debentures and Warrants

Rhea-AI Summary

Barksdale Resources (BRKCF) has closed a CDN$3,000,000 secured convertible debentures offering with Delbrook Capital Advisors, maturing December 31, 2027. The New Debentures are convertible at CDN$0.12 per share with a 10% annual interest rate. Concurrently, the company extended its existing CDN$1,500,000 convertible debentures and 8,000,000 warrants from 2025 to 2027. The company issued 7,500,000 new warrants at CDN$0.12 per share. Delbrook has a put option after December 31, 2026. Proceeds will fund Barksdale's 51% earn-in at the Sunnyside project in Arizona, with CDN$1,000,000 allocated for further exploration. A finder's fee of 1,200,000 shares was paid to Medalist Capital Advisors.

Positive

• Secured CDN$3,000,000 in new financing through convertible debentures
• Successfully extended maturity of existing CDN$1,500,000 debentures to 2027
• Funds secured to achieve 51% interest in Sunnyside project
• Strong backing from institutional investor Delbrook Capital

Negative

• 10% annual interest rate represents significant debt servicing cost
• Potential dilution from convertible debentures and warrants at CDN$0.12 per share
• Additional 1,200,000 shares issued as finder's fee causing immediate dilution

Vancouver, British Columbia--(Newsfile Corp. - May 1, 2025) - Barksdale Resources Corp. (TSXV: BRO) (OTCQX: BRKCF) ("Barksdale" or the "Company"), is pleased to announce that it has closed the previously-announced (see news release dated April 14, 2025) private placement offering of secured convertible debentures in the principal amount of CDN$3,000,000 maturing December 31, 2027 (the "New Debentures"), subject to the holder put right described below, for gross proceeds of CDN$3,000,000 (the "Principal Amount"), to investment funds managed by Delbrook Capital Advisors Inc. ("Delbrook"). Concurrent with the New Debenture offering, the Company also extended the maturity date of its existing secured convertible debentures in the principal amount of CDN$1,500,000 (the "Existing Debentures") and the expiry date of an associated 8,000,000 detachable share purchase warrants previously issued to Delbrook in connection with the Existing Debentures (the "Extension Warrants") from December 31, 2025 to December 31, 2027. Additional details are set out below.

The New Debentures are convertible into common shares at a conversion price of CDN$0.12 per share, bear interest a rate of 10% per annum and are supported by general security and share pledges from Barksdale and certain subsidiaries and secured guarantees from certain of Barksdale's direct and indirect subsidiaries, including the entity that holds a membership interest in the joint venture limited liability company for the Sunnyside Project. The New Debentures will come due on December 31, 2027, subject to Delbrook's option to require the Company, upon at least 20 days' notice (in each case, a "Put Date") at any time on or after December 31, 2026 to repurchase all or any portion of the New Debentures in which case, the Company must pay back the amount requested (the "Put Amount") plus any interest owed up to the Put Date (collectively, "Holder Put Right"). If only a portion of the New Debentures is repurchased by the Company, the Company will issue a new debenture for the balance of the Principal Amount. The Put Date will be deemed to be the last date for conversion and maturity date of the applicable Put Amount with the conversion rate being CDN$0.12 per common share.

In consideration for the New Debentures, the Company has issued 7,500,000 detachable share purchase warrants to Delbrook (the "New Warrants"), with each detachable warrant entitling the holder to acquire one common share of the Company at an exercise price of CDN$0.12 per common share until December 31, 2027, provided that, if Delbrook exercises the Holder Put Right under the New Debentures and the Company repays to Delbrook the applicable Put Amount, the expiry date for a pro rata portion of the warrants corresponding to the portion of the New Debentures put to and repaid by the Company will accelerate to the date that is the later of the applicable Put Date and the 30^th day of that Put Date (the "Warrant Put Right Acceleration").

The Existing Debentures shall be subject to the same Holder Put Right as with the New Debentures described above and the Extension Warrants shall be subject to the same Warrant Put Right Acceleration as with the New Warrrants.

William Wulftange, CEO of Barksdale commented that: "Thanks to Delbrook Capital Advisor's unwavering support, Barksdale Resources can now focus on completing the earn-in process with Regal Resources, plan the exploration program to extend and define the Taylor and Peake deposits onto the Sunnyside property, and even discover new deposits unique to the Sunnyside Property."

Barksdale is required to use the proceeds of the New Debentures to satisfy all payments and requirements necessary for the Company to achieve and maintain a 51% interest in the Arizona Standard LLC joint venture and its Sunnyside assets in Arizona and to satisfy additional earn-in requirements, and for exploration expenditures and working capital. Further, of the net proceeds, CDN$1,000,000 will be used for further earn-in requirements and for exploration expenditures after Barksdale has earned its 51% interest.

In consideration of the extensions, the security granted for the Existing Debentures has been amended to align with that of the New Debentures, with both the Existing Debentures and New Debentures ranking pari passu as senior secured obligations of the Company.

The Company has paid a finder's fee of 1,200,000 common shares with a deemed (the "Finder's Fee Shares") price of CDN$0.12 per common share to Medalist Capital Advisors Inc. in connection with the foregoing financing.

The New Debentures and the New Warrants and all underlying common share issuable upon the exercise thereof as well as the Finder's Fee Shares will be subject to a four-month plus one day hold period in accordance with Canadian securities legislation and the policies of the TSXV.

Barksdale Resources Corp., a 2023 OTCQX BEST 50 Company, is a base metal exploration company headquartered in Vancouver, B.C., that is focused on the acquisition, exploration and advancement of highly prospective base metal projects in North America. Barksdale is currently advancing the Sunnyside copper-zinc-lead-silver and San Antonio copper projects, both of which are in the Patagonia mining district of southern Arizona, as well as the San Javier copper-gold project in central Sonora, Mexico.

ON BEHALF OF BARKSDALE RESOURCES CORP.

William Wulftange
Chief Executive Officer and Director

For more information, please phone Investor Relations at 604-398-5385, email info@barksdaleresources.com or visit www.BarksdaleResources.com.

Neither the 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.

CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS: This news release contains certain "forward-looking information" and "forward-looking statements" (collectively "forward- looking statements") within the meaning of applicable securities legislation. Forward-looking statements are frequently, but not always, identified by words such as "expects", "anticipates", "believes", "intends", "estimates", "potential", "possible", and similar expressions, or statements that events, conditions, or results "will", "may", "could", or" should" occur or be achieved. All statements, other than statements of historical fact, included herein, without limitation, statements relating to the foregoing financing and amendments are forward-looking statements. There can be no assurance that such statements will prove to be accurate, and actual results and future events could differ materially from those anticipated in such statements. Forward-looking statements reflect the beliefs, opinions and projections on the date the statements are made and are based upon a number of assumptions and estimates that, while considered reasonable by Barksdale, are inherently subject to significant business, economic, competitive, political and social uncertainties and contingencies. Many factors, both known and unknown, could cause actual results, performance or achievements to be materially different from the results, performance or achievements that are or may be expressed or implied by such forward-looking statements and the Company has made assumptions and estimates based on or related to many of these factors. All forward-looking statements contained in this news release are qualified by these cautionary statements and those in the Company's continuous disclosure filings available on SEDAR+ at www.sedarplus.ca. Readers should not place undue reliance on the forward-looking statements contained in this news release concerning these items. Barksdale does not assume any obligation to update the forward-looking statements of beliefs, opinions, projections, or other factors, should they change, except as required by applicable securities laws.

To view the source version of this press release, please visit https://www.newsfilecorp.com/release/250517

FAQ

What is the size and terms of BRKCF's new convertible debenture offering?

Barksdale Resources closed a CDN$3,000,000 convertible debenture offering with Delbrook Capital, convertible at CDN$0.12 per share, bearing 10% annual interest and maturing December 31, 2027.

How will Barksdale Resources (BRKCF) use the proceeds from the debenture offering?

The proceeds will be used to achieve and maintain a 51% interest in the Arizona Standard LLC joint venture (Sunnyside assets), with CDN$1,000,000 allocated for further earn-in requirements and exploration expenditures.

What warrants were issued with BRKCF's convertible debenture offering?

Barksdale issued 7,500,000 new detachable warrants exercisable at CDN$0.12 per share until December 31, 2027, and extended 8,000,000 existing warrants to the same date.

What is the put option feature in BRKCF's new debentures?

Delbrook can require Barksdale to repurchase all or part of the debentures after December 31, 2026, with 20 days' notice, at which point the company must repay the requested amount plus interest.