Core Viewpoint - Barnwell Industries, Inc. has adjourned its 2025 Annual Meeting of Shareholders due to the Sherwood Group's refusal to vote the proxies they solicited, which has led to significant expenses and prevented the company from reaching a quorum for the first time in its 70-year history [1][2][3]. Group 1: Meeting Details - The 2025 Annual Meeting of Shareholders was held on May 29, 2025, and has been adjourned to June 2, 2025, at 9:00 a.m. HST [1][4]. - The meeting will take place at Suite 210, Alakea Corporate Tower, 1100 Alakea Street, Honolulu, Hawaii [4]. Group 2: Sherwood Group's Actions - Ned Sherwood and his affiliates, collectively known as the Sherwood Group, actively solicited proxies from Barnwell shareholders but failed to submit them, which is seen as a deliberate attempt to disenfranchise shareholders [2][3]. - Sherwood's actions contradict his public statement claiming to respect the will of the shareholders, leading to unnecessary expenses for the company [2][3]. Group 3: Legal and Regulatory Response - The company is consulting with legal and regulatory counsel to pursue remedies ensuring shareholders have a fair opportunity to vote at the reconvened meeting [4]. - The conduct of the Sherwood Group may constitute violations of federal securities laws, including anti-fraud provisions [3].

Core Points - The Delaware Court of Chancery ruled in favor of Barnwell Industries, confirming that the Sherwood Group's director nomination notice was deficient and did not comply with the company's bylaws, leading to the disqualification of their nominees for the 2025 Annual Meeting [1] - The 2025 Annual Meeting is scheduled to be held as an uncontested election on May 29, 2025 [1] - Alexander C. Kinzler, a 9.8% stockholder, has decided not to stand for election at the 2025 Annual Meeting following the Sherwood Group's recent consent solicitation [2] Company Statements - Joshua Horowitz, an independent director and Chairman of the Nomination and Executive Committees, expressed satisfaction with the court's ruling and urged the Sherwood Group to cease its disruptive campaigns, emphasizing a focus on value creation for the company [2] - The company acknowledged Kinzler's contributions to the Board and welcomed Heather Isidoro, highlighting her industry expertise and relevant experience [3] - Barnwell plans to file supplemental materials with the Securities and Exchange Commission regarding the uncontested 2025 Annual Meeting and the court ruling [3]

Core Viewpoint - The Sherwood Group, a significant shareholder of Barnwell Industries, criticizes the company's financial performance and governance, urging shareholders to focus on the deteriorating financial results and the recent going concern warning disclosed in their 10-Q [1][3]. Financial Performance - Barnwell has a long history of financial underperformance, with a distressed balance sheet and ongoing losses from operations, even during favorable commodity cycles [3][4]. - The company has spent nearly $1 million in legal fees recently and approximately $7 million over the past several years, raising concerns about its financial management [3]. - The recent financial issues are attributed to wasteful spending on non-economic matters, with a going concern warning indicating serious financial distress [3][6]. Governance Issues - The current board is accused of failing to align with shareholder interests and not taking responsibility for the company's financial decline [2][6]. - The Sherwood Group emphasizes the need for urgent changes in governance and capital allocation to restore trust and accountability [6]. - There are concerns about the board's decision-making, particularly regarding the lack of hedging activities that could mitigate volatility in energy prices [3]. Shareholder Engagement - The Sherwood Group calls for respect for shareholder votes and transparency in governance, criticizing Barnwell for not honoring the results of the consent solicitation [5][6]. - The group has encouraged shareholders to support their board nominees and abandon efforts to block a universal proxy [7].

Core Viewpoint - Barnwell Industries, Inc. is committed to serving the best interests of all shareholders and maintaining governance best practices amidst ongoing attempts by the Sherwood Group to take control of the company [1][2]. Governance and Board Composition - The Board of Directors of Barnwell has welcomed Heather Isidoro as a new member, reflecting shareholder input and a commitment to long-term value creation [3][4]. - Barnwell's directors are experienced and aligned with shareholder interests, focusing on long-term value rather than personal agendas [2]. Response to Sherwood Group - Both Institutional Shareholder Services and Glass Lewis have rejected the Sherwood Group's attempts to take control, recommending shareholders vote for Barnwell's current directors [5]. - The Sherwood Group has been accused of distorting facts and lacking a credible plan for Barnwell's future, with no clear operating strategy or vision presented [7][10]. Company Performance and Strategy - Under the current Board's oversight, Barnwell has executed profitable land sales in Hawaii, maintained discipline through volatile energy cycles, reduced non-proxy contest related SG&A expenses, and explored strategic capital allocation opportunities [8]. - Barnwell has offered the Chairmanship to Mr. Sherwood as a gesture of good faith, which he rejected, indicating a lack of genuine interest in collaboration [9]. Legal and Governance Matters - Barnwell is awaiting a decision from the Delaware Court of Chancery regarding the validity of the Sherwood Group's nomination notice for the upcoming 2025 annual meeting [11]. - The company remains open to constructive discussions with the Sherwood Group to resolve governance matters collaboratively [12].

[Financial Highlights](index=1&type=section&id=Financial%20Highlights) Barnwell Industries reported Q2 2025 revenue from continuing operations of $3.57 million and a net loss of $1.54 million, primarily due to increased general and administrative expenses from a proxy contest Comparative Financial Performance | Financial Metric | Q2 2025 | Q2 2024 | | :--- | :--- | :--- | | Revenue from Continuing Operations | $3,569,000 | $4,678,000 | | Net Loss from Continuing Operations | $(1,538,000) | $(1,306,000) | | Net Loss per Share from Continuing Operations | $(0.15) | $(0.13) | | Net Loss Attributable to Barnwell | $(1,207,000) | $(1,772,000) | - The net loss from continuing operations for Q2 2025 was exacerbated by a **$906,000 (72%)** increase in general and administrative expenses, which included **$978,000** in new costs related to a shareholder consent solicitation and proxy contest[3](index=3&type=chunk) [Analysis of Operations](index=1&type=section&id=Analysis%20of%20Operations) Operational performance was impacted by production declines in oil and gas, no land sales, and the reclassification of the contract drilling business as discontinued operations [Oil and Gas Operations](index=1&type=section&id=Non-Cash%20Impairment%2C%20Oil%20and%20Gas%20Production) The oil and gas segment saw production declines but a significantly lower non-cash impairment charge and decreased depletion expenses partially offset the financial impact Year-over-Year Production Changes | Production Change (YoY) | Percentage Decrease | | :--- | :--- | | Oil | 14% | | Natural Gas | 24% | | Natural Gas Liquids | 13% | - A non-cash ceiling test impairment of **$52,000** was recorded, a decrease of **$1,625,000** from the **$1,677,000** impairment in the prior year's second quarter[4](index=4&type=chunk) - Oil and natural gas depletion expense decreased by **$589,000** compared to Q2 2024, due to a lower depletion rate from prior years' write-downs and decreased production[4](index=4&type=chunk) [Land Investment Segment](index=1&type=section&id=Land%20Investment%20Segment) Operating results for the land investment segment decreased by $500,000 due to no lot sales in Q2 2025, compared to two lots sold in the prior year - The land investment segment's operating results decreased by **$500,000** as no lots were sold in Q2 2025, compared to two lots sold in Q2 2024[3](index=3&type=chunk) [Sale of Contract Drilling Business (Discontinued Operations)](index=1&type=section&id=Sale%20of%20our%20Water%20Drilling%20Subsidiary) The company sold its water drilling subsidiary for $1.05 million, recording a $193,000 loss, and reclassified the business as discontinued operations - Completed the sale of its subsidiary, Water Resources International, Inc., for **$1,050,000**[5](index=5&type=chunk) - Recorded a loss of **$193,000** on the sale in the quarter ended March 31, 2025[5](index=5&type=chunk) - The results of the contract drilling business have been reclassified as discontinued operations for all periods presented[5](index=5&type=chunk) [Corporate Developments and Outlook](index=2&type=section&id=Corporate%20Developments%20and%20Outlook) The company faces significant financial pressure from a proxy contest and lower oil prices, raising substantial doubt about its going concern ability, prompting exploration of funding and cost reductions [Proxy Contest and Going Concern](index=2&type=section&id=Proxy%20Contest%2C%20Expenses%20Increase) The ongoing proxy contest and oil price impacts are causing high administrative expenses and cash flow uncertainty, leading to substantial doubt about the company's going concern ability - The ongoing proxy contest will continue to affect general and administrative expenses beyond March 31, 2025[6](index=6&type=chunk) - The company faces substantial doubt about its ability to continue as a going concern due to proxy contest costs and the impact of tariffs on oil prices[7](index=7&type=chunk) - Potential funding sources being investigated include debt financing, non-core property sales, and the sale of interests in the Kukio Resort Land Development Partnerships[7](index=7&type=chunk) [CEO's Summary and Outlook](index=2&type=section&id=Summary%20and%20Outlook) CEO Craig D. Hopkins noted the proxy contest harmed liquidity, while the contract drilling business sale aims to refocus and reduce costs, with the company ending Q2 2025 with a working capital deficit and $1.43 million cash - CEO Craig D. Hopkins noted the proxy contest has negatively impacted liquidity and hindered investment[8](index=8&type=chunk) - The sale of the contract drilling business is a strategic move to refocus efforts and reduce fixed costs[8](index=8&type=chunk) - The company ended the quarter with a working capital deficit of **$57,000** and cash and cash equivalents of **$1,432,000**[8](index=8&type=chunk) [Comparative Operating Results](index=3&type=section&id=COMPARATIVE%20OPERATING%20RESULTS) The company presented comparative operating results for the three and six-month periods ending March 31, 2025, showing year-over-year declines in revenues and increased net losses from continuing operations Comparative Operating Results (Unaudited) | (Unaudited) | Three months ended March 31, | Six months ended March 31, | | :--- | :--- | :--- | | | **2025** | **2024** | **2025** | **2024** | | **Revenues** | $3,569,000 | $4,678,000 | $7,503,000 | $9,840,000 | | **Net loss from continuing operations** | $(1,538,000) | $(1,306,000) | $(3,136,000) | $(1,656,000) | | **Net earnings (loss) from discontinued operations** | $331,000 | $(466,000) | $12,000 | $(780,000) | | **Net loss attributable to Barnwell** | $(1,207,000) | $(1,772,000) | $(3,124,000) | $(2,436,000) | | **Net loss per share from continuing operations** | $(0.15) | $(0.13) | $(0.31) | $(0.16) |

[PART I. FINANCIAL INFORMATION](index=3&type=section&id=PART%20I.%20FINANCIAL%20INFORMATION) [Financial Statements (Unaudited)](index=3&type=section&id=Item%201.%20Financial%20Statements%20(Unaudited)) The company presents unaudited financial statements reflecting a net loss and the sale of its contract drilling segment [Condensed Consolidated Balance Sheets](index=3&type=section&id=Condensed%20Consolidated%20Balance%20Sheets%20-%20March%2031%2C%202025%20and%20September%2030%2C%202024) Total assets and equity decreased significantly due to lower cash and the reclassification of discontinued operations Condensed Consolidated Balance Sheet Highlights (in thousands) | Account | March 31, 2025 | September 30, 2024 | | :--- | :--- | :--- | | **Assets** | | | | Cash and cash equivalents | $1,432 | $4,285 | | Total current assets | $4,795 | $8,883 | | Total property and equipment, net | $14,023 | $16,566 | | **Total Assets** | **$24,377** | **$30,669** | | **Liabilities & Equity** | | | | Total current liabilities | $4,852 | $7,812 | | **Total Liabilities** | **$14,222** | **$17,607** | | **Total Equity** | **$10,155** | **$13,062** | - Assets and liabilities related to the contract drilling segment, sold on March 14, 2025, are classified as **discontinued operations**[9](index=9&type=chunk)[28](index=28&type=chunk) [Condensed Consolidated Statements of Operations](index=5&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations%20-%20three%20and%20six%20months%20ended%20March%2031%2C%202025%20and%202024) The company's net loss widened due to lower revenues and higher G&A expenses, resulting in a loss of $0.31 per share Statement of Operations Highlights (in thousands, except per share data) | Metric | Six Months Ended Mar 31, 2025 | Six Months Ended Mar 31, 2024 | | :--- | :--- | :--- | | Total Revenues | $7,503 | $9,840 | | General and administrative | $3,325 | $2,576 | | Impairment of assets | $665 | $1,677 | | Net loss from continuing operations | $(3,138) | $(1,432) | | Net earnings (loss) from discontinued operations | $12 | $(780) | | **Net loss attributable to Barnwell** | **$(3,124)** | **$(2,436)** | | **Net loss per share (basic & diluted)** | **$(0.31)** | **$(0.24)** | [Condensed Consolidated Statements of Cash Flows](index=9&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows%20-%20six%20months%20ended%20March%2031%2C%202025%20and%202024) Operating cash flow turned negative, reversing from the prior year, driven by lower earnings and working capital changes Cash Flow Highlights - Continuing Operations (in thousands) | Cash Flow Activity | Six Months Ended Mar 31, 2025 | Six Months Ended Mar 31, 2024 | | :--- | :--- | :--- | | Net cash (used in) provided by operating activities | $(854) | $3,000 | | Net cash used in investing activities | $(2,272) | $(1,185) | | Net cash used in financing activities | $(15) | $(223) | | **Net (decrease) increase in cash** | **$(3,073)** | **$855** | [Notes to Condensed Consolidated Financial Statements](index=10&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) Key disclosures include the sale of a subsidiary, a going concern warning, asset impairments, and a poison pill adoption - On March 14, 2025, the company sold its subsidiary, Water Resources International, Inc, for **$1.05 million**; its results are now classified as discontinued operations[28](index=28&type=chunk)[33](index=33&type=chunk) - Management has identified **substantial doubt about the company's ability to continue as a going concern** due to costs from a shareholder proxy contest and reduced oil prices[31](index=31&type=chunk)[102](index=102&type=chunk) - The company recorded a **non-cash ceiling test impairment of $665,000** on its U.S. oil and gas properties, with a further impairment likely next quarter[60](index=60&type=chunk)[61](index=61&type=chunk) - On January 26, 2025, the Board adopted a **limited-duration shareholder rights plan ("poison pill")** to deter hostile takeovers[88](index=88&type=chunk)[89](index=89&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=29&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses the going concern warning, a wider net loss, and negative operating cash flow [Current Outlook](index=29&type=section&id=Current%20Outlook) The company's outlook is dominated by a going concern warning due to a proxy contest and volatile oil prices - There is **substantial doubt about the company's ability to continue as a going concern** due to costs from a shareholder proxy contest and funding uncertainty[102](index=102&type=chunk)[159](index=159&type=chunk) - Potential funding sources being investigated include **debt financing or asset sales**, but no timing or amounts are secured[103](index=103&type=chunk)[161](index=161&type=chunk) - Following the sale of Water Resources, the company's continuing operations consist of its **oil and natural gas segment and its land investment segment**[108](index=108&type=chunk)[109](index=109&type=chunk) [Results of Operations](index=33&type=section&id=Results%20of%20Operations) The net loss from continuing operations increased significantly, driven by higher G&A costs and lower revenues Net Loss from Continuing Operations (in thousands) | Period | Net Loss Attributable to Barnwell | | :--- | :--- | | Three months ended Mar 31, 2025 | $(1,538) | | Three months ended Mar 31, 2024 | $(1,306) | | Six months ended Mar 31, 2025 | $(3,136) | | Six months ended Mar 31, 2024 | $(1,656) | - **G&A expenses increased by $749,000** for the six-month period, primarily due to **$941,000 in fees** related to a shareholder proxy contest[134](index=134&type=chunk) - **Equity in income of affiliates decreased by $1,071,000** to nil, as no lots were sold by the Kukio Resort Land Development Partnerships[141](index=141&type=chunk) Oil & Gas Production Volumes (Six Months Ended March 31) | Product | 2025 | 2024 | % Change | | :--- | :--- | :--- | :--- | | Natural Gas (Mcf) | 551,000 | 713,000 | (23%) | | Oil (Bbls) | 91,000 | 108,000 | (16%) | | NGLs (Bbls) | 29,000 | 34,000 | (15%) | [Liquidity and Capital Resources](index=40&type=section&id=Liquidity%20and%20Capital%20Resources) The company reports a working capital deficit and negative operating cash flow, reinforcing the going concern doubt - At March 31, 2025, the company had a **working capital deficit of $57,000**[152](index=152&type=chunk) Cash Flow from Continuing Operations (Six Months Ended March 31, in thousands) | Cash Flow Activity | 2025 | 2024 | | :--- | :--- | :--- | | Operating Activities | $(854) | $3,000 | | Investing Activities | $(2,272) | $(1,185) | - Estimated oil and natural gas capital expenditures for fiscal 2025 are projected to be between **$500,000 and $1,000,000**[163](index=163&type=chunk) [Controls and Procedures](index=42&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that disclosure controls and procedures were effective as of the end of the reporting period - The CEO and CFO concluded that as of March 31, 2025, the company's **disclosure controls and procedures were effective**[166](index=166&type=chunk) - There were **no material changes in internal control over financial reporting** during the quarter ended March 31, 2025[167](index=167&type=chunk) [PART II. OTHER INFORMATION](index=44&type=section&id=PART%20II.%20OTHER%20INFORMATION) [Risk Factors](index=44&type=section&id=Item%201A.%20Risk%20Factors) The company identifies new risks from a shareholder proxy contest and reiterates its going concern warning - A new risk factor is the **ongoing proxy contest by the Sherwood Group**, which has caused substantial legal fees and is expected to negatively impact operations[171](index=171&type=chunk)[173](index=173&type=chunk) - A second new risk factor is the **substantial doubt about the company's ability to continue as a going concern**, driven by proxy contest costs and volatile commodity prices[174](index=174&type=chunk)[176](index=176&type=chunk) [Other Information](index=45&type=section&id=Item%205.%20Other%20Information) No directors or officers adopted or terminated Rule 10b5-1 trading plans during the quarter - No director or officer adopted or terminated a **Rule 10b5-1 or non-Rule 10b5-1 trading arrangement** during the quarter ended March 31, 2025[177](index=177&type=chunk) [Exhibits](index=46&type=section&id=Item%206.%20Exhibits) This section lists filed exhibits, including the subsidiary sale agreement and Sarbanes-Oxley certifications - Exhibit 10.1 is the **Stock Purchase Agreement** for the sale of the company's contract drilling subsidiary[178](index=178&type=chunk) - Exhibits 31.1 and 31.2 contain the required **Sarbanes-Oxley Act Section 302 certifications** from the CEO and CFO[178](index=178&type=chunk)

Core Viewpoint - Barnwell Industries, Inc. reported a net loss from continuing operations of $1,538,000 for Q2 2025, compared to a loss of $1,306,000 in Q2 2024, indicating ongoing financial challenges and increased operational costs [1][2][11]. Financial Performance - Revenue from continuing operations for Q2 2025 was $3,569,000, down from $4,678,000 in Q2 2024, reflecting a decline of approximately 23.6% [1][11]. - The net loss per share from continuing operations was $0.15 for Q2 2025, compared to $0.13 in the prior year [1][11]. - For the six months ended March 31, 2025, total revenue was $7,503,000, down from $9,840,000 in the same period of the previous year [11]. Expense Analysis - General and administrative expenses increased by $906,000, or 72%, primarily due to costs associated with a shareholder consent solicitation and a proxy contest [2][5]. - The company experienced a decrease in oil and natural gas production, with oil production down 14%, natural gas down 24%, and natural gas liquids down 13% compared to the prior year [3]. Asset Sales and Discontinued Operations - The company sold its subsidiary, Water Resources International, Inc., for $1,050,000, resulting in a loss of $193,000 on the sale [4][11]. - The results from the contract drilling business have been reclassified as discontinued operations [4]. Future Outlook - The ongoing proxy contest is expected to continue impacting the company's liquidity and investment opportunities [7]. - The company is exploring potential funding sources, including debt financing and asset sales, but has not secured any definite amounts or timelines [6][7].

Core Viewpoint - Barnwell Industries, Inc. shareholders have rejected the Sherwood Group's attempt to take control of the Board of Directors, while also consenting to the removal of certain directors and the election of a new nominee [1][2][3]. Group 1: Shareholder Decisions - Preliminary results indicate that shareholders consented to remove directors Alexander Kinzler and Douglas Woodrum, while electing Heather Isidoro from the Sherwood Group [2]. - Despite some changes, Barnwell Directors Ken Grossman and Joshua Horowitz will continue to serve, ensuring continuity and independent oversight [2]. - The Sherwood Group's campaign to remove Douglas Woodrum was notably supported, as he received the most consents for removal among directors [3]. Group 2: Legal and Governance Matters - Barnwell is awaiting a decision from the Delaware Court of Chancery regarding the validity of the Sherwood Group's nomination notice for the upcoming 2025 annual meeting [4]. - The Company has determined that the Sherwood Group's nomination notice did not comply with applicable bylaws and has rejected it [4]. - Barnwell intends to supplement its proxy materials for the 2025 annual meeting following the Court's decision [4]. Group 3: Executive Commentary - Alexander Kinzler expressed disappointment with the consent solicitation results but indicated a willingness to step down as a director by the end of 2025 if elected [5]. - Kinzler plans to assist in identifying a successor Chief Financial Officer and transitioning the Company's headquarters from Honolulu to Calgary [5]. - The Company remains open to constructive discussions with the Sherwood Group to reach a resolution that benefits all shareholders [6]. Group 4: Reporting and Certification - The results of the consent solicitation are considered preliminary until certified by the independent Inspector of Elections [7]. - Barnwell will report the final results on a Form 8-K to be filed with the Securities and Exchange Commission by May 19, 2025 [7].

HONOLULU, May 12, 2025 /PRNewswire/ -- Barnwell Industries, Inc. (NYSE American: BRN) ("Barnwell" or the "Company") today urged shareholders to follow the recommendation by leading proxy advisory firm Institutional Shareholder Services Inc. ("ISS") in its May 7, 2025, report in which it recommended just one candidate, Heather Isidoro, from the slate put forward by Ned Sherwood and his affiliates (the "Sherwood Group").In its report, ISS stated1: Barnwell Industries, Inc. As such, votes on the dissiden ...

Core Viewpoint - The Sherwood Group, a significant shareholder of Barnwell Industries, is expressing dissatisfaction with the current management's performance and is advocating for a change in leadership to improve operational efficiency and shareholder returns [1][4][5]. Group 1: Shareholder Concerns - The Sherwood Group holds approximately 29.90% of Barnwell's shares and has made multiple attempts to collaborate with management over the past four years, but has seen no meaningful progress [1]. - The Barnwell Board has reportedly spent over $6 million, which is about 50% of the company's market capitalization, on legal fees and other actions perceived as shareholder unfriendly [2]. - There has been a consistent lack of execution and accountability from the management team, leading to inadequate shareholder returns [4]. Group 2: Call for Action - The Sherwood Group believes that the time for negotiation has passed and is now seeking to initiate a consent solicitation to change the board of directors [5]. - The group emphasizes that their goal is not to take control but to enhance operations and drive value for all investors by appointing a board with independent directors who possess relevant expertise [6]. - Shareholders are urged to approve the BLUE consent card to facilitate the turnaround efforts for Barnwell [7].