Barrel Energy Inc. Enters $200K Convertible Note Financing

What Happened

• Barrel Energy, Inc. announced on an 8-K that it entered a Securities Purchase Agreement with CFI Capital LLC and issued a 6% Convertible Redeemable Note dated August 21, 2026. The note’s original principal is $200,000; the financing closed on August 24, 2026. The investor paid $180,000 (a $20,000 original issue discount); after $7,000 in legal fees paid to the investor’s counsel, the Company received net cash proceeds of $173,000. The Note matures August 21, 2027 and bears interest at 6% per year, with interest payable in common stock under the Note’s conversion formula.

Key Details

• Issuer: Barrel Energy, Inc.; Investor: CFI Capital LLC; Note date: August 21, 2026; close date: August 24, 2026.
• Principal and pricing: $200,000 principal; purchase price $180,000 (OID $20,000); net cash to company $173,000 after $7,000 disbursement.
• Conversion terms: Convertible beginning six months after issuance; conversion price equals 60% of the lowest trading price during the 20 trading days up to and including conversion date (reduced to 50% if a DTC “chill” is in effect; may be reduced to 45% after certain defaults).
• Ownership limits & reserves: Investor beneficial ownership post-conversion capped at 4.99% (can be raised to 9.9% with 60 days’ notice). Company reserved 11,111,111 shares for conversion and agreed to maintain a reserve equal to at least 500% of the shares issuable on conversion, subject to available authorized shares.
• Other: Note payable in full by Aug 21, 2027; prepayment allowed in first 180 days at premiums of 105%–140% of principal plus accrued interest. Transfer agent instructions and standard agreement provisions were filed as exhibits.

Why It Matters

• The company received a quick, short‑term cash infusion of $173,000, which can help near‑term operations or working capital needs.
• The financing creates potential dilution because interest is paid in stock and the note is convertible at a steep discount to recent trading prices (potentially 60%, 50% or 45% in specified conditions). That conversion formula can result in a meaningful number of new shares if conversion occurs.
• The note is a one‑year obligation, so investors should note the near-term maturity and prepayment premium structure, plus the investor ownership caps and the company’s reserved shares to satisfy potential conversions.