Canstar Resources has entered into definitive agreements with BQS Systematic Equities LP, an entity controlled by company director J. Paul Austin III, for a C$500,000 revolving bridge credit facility. The arrangement replaces an existing promissory note and provides interim working capital as the company prepares its permanent financing.

The initial advance under the facility was deployed to fully repay and cancel an outstanding US$241,000 promissory note in favour of BQS. The new facility provides revolving advances of up to C$500,000 with no borrowing-base test, and any repaid amounts may be re-borrowed.

The credit facility is secured solely by a pledge of 15,834,097 common shares of Churchill Resources held by Canstar Resources, alongside any further Churchill shares receivable under the company's option agreement for the Golden Baie Project in southern Newfoundland. BQS holds no recourse to any other company assets and has no deficiency claim if the pledged share value drops below the outstanding balance.

Interest accrues at 12 percent per annum on drawn principal and is payable monthly in Churchill shares valued at the ten-trading-day volume-weighted average price. The facility matures nine months from the initial advance date and may be prepaid at any time, subject to a fixed minimum interest requirement of six months.

The transaction constitutes a related-party transaction under Multilateral Instrument 61-101 due to director J. Paul Austin III's control of BQS. Canstar Resources' independent directors approved the facility after Austin abstained from the deliberations, determining that the terms are no less advantageous than those available from an arm's-length lender.

Canstar initiated a 2026 summer drill program at its Mary March volcanogenic massive sulphide project in central Newfoundland, marking the company's first drilling at the property since 2019. Assays remain pending for a discrete one-metre visually logged massive sulphide interval located 19 metres below the main assayed section.

Read the full announcement: Canstar Resources Enters into C$500,000 Director-Related Bridge Facility Secured Solely by Churchill Shares; Existing Bridge Note Repaid and Cancelled