Baru Announces Amendment to Matured Convertible Loan and Issuance of Bonus Warrants

Baru Gold Corp. has entered into a forbearance agreement with Mercer Street Global Opportunity Fund, LLC, delaying the repayment of a matured convertible loan until July 17, 2027. In exchange for this extension, the company will issue 6,528,879 non-transferable bonus warrants to Mercer, exercisable at CDN$0.0675 per share and expiring July 15, 2027. The warrants are calculated based on a portion of the loan valued at CDN$440,699, while the total outstanding loan value stands at CDN$816,110.

Under the terms of the agreement, the loan interest rate is reduced from 18.0% to 16.67% per annum. A penalty rate will apply if the loan remains outstanding after the forbearance date. Additionally, the loan is rendered unsecured against the company's equity interest in Sangihe Gold Corporation. The transaction requires final approval from the TSX Venture Exchange.

Baru Gold Corp. (BARU) announced a standard debt restructuring aimed at avoiding a technical default on a matured loan, a move that does not inject new capital into the company. With a reported cash balance of $42,194 CAD and a $7.77M working capital deficiency, the resulting forbearance serves as a necessary stopgap rather than a strategic victory.

The transaction includes the issuance of approximately 6.5 million warrants at $0.0675, representing dilutive financing at a significant premium to the current market price. This is a typical cost of extending debt maturity for pre-revenue junior miners. The announcement aligns with the company's historical pattern of raising small amounts of capital, including $336k in June 2026 and $1.3M in July 2025, to fund operations while awaiting regulatory approval. The news is not expected to generate material upside, as it merely extends the company's runway by one year while increasing the warrant overhang.

Baru Gold Corp. is a Canadian junior mining company focused on the Sangihe Gold Project on Sangihe Island, North Sulawesi, Indonesia. The company holds a 70% interest in PT Tambang Mas Sangihe (TMS), which holds the mineral tenement contract of work (CoW). The project covers approximately 25,000 hectares, with a 65-hectare zone targeted for initial production. Only 10% of the gold-bearing area has been explored.

NI 43-101 resources indicate more than 200,000 ounces of gold, comprising 114,000 ounces indicated and 91,000 ounces inferred, and more than 3,000,000 ounces of silver within the initial production area. The company plans to proceed to production without establishing mineral reserves or completing a feasibility study, acknowledging increased technological and economic risks. An automated, modular electrowinning plant is being fabricated in Indonesia, designed for an initial capacity of 1,500 ounces of gold per month, scalable to 3,000 ounces per month.