New Break receives $2-million from warrant exercise

Executive Summary

• New Break Resources Ltd. completed the early exercise of 15,796,000 common share purchase warrants, resulting in aggregate gross proceeds of $1,933,020 from the accelerated warrants.
• An additional 337,500 warrants (not part of the acceleration) were exercised for $67,500, bringing the total cash raised from these exercises to $2,000,520.
• The transaction constitutes a related party transaction involving John Ross and Patricia Quigley, who now own 23.94% of the company's issued and outstanding common shares.

Key Details

• Total Gross Proceeds: $2,000,520 ($1,933,020 from accelerated warrants + $67,500 from non-accelerated warrants).
• Accelerated Warrant Exercises:
  • 14,546,000 warrants exercised at $0.12 per share.
  • 1,250,000 warrants exercised at $0.15 per share.
  • Acceleration triggered because the closing price was ≥ $0.25 for five non-consecutive trading days; expiry date accelerated to Oct. 14, 2025.
• Non-Accelerated Warrant Exercise:
  • 337,500 warrants exercised at $0.20 per share.
  • Original expiry date for these warrants was June 23, 2026.
• Post-Transaction Share Count: 86,202,100 common shares issued and outstanding.
• Remaining Outstanding Warrants: 2,236,350 warrants total.
  • 736,350 warrants at $0.20 per share.
  • 1,500,000 warrants at $0.25 per share.
• Related Party Details:
  • John Ross and Patricia Quigley exercised 2,075,000 warrants at $0.12/share and 1,000,000 warrants at $0.15/share.
  • Transaction relied on exemptions from formal valuation and minority shareholder approval under Multilateral Instrument 61-101 (Sections 5.5(a) and 5.7(1)(a)) as issuance did not exceed 25% of market capitalization.
  • Quigleys' ownership post-transaction: 23.94% of issued and outstanding common shares.
• Hold Periods:
  • 1,252,000 shares have a hold period until Oct. 28, 2025.
  • 6,188,000 shares have a hold period until Jan. 6, 2026.
• Company Treasury: Approximately $2.2 million in cash following these exercises.