Register for free to join our community of investors and share your ideas. You will also get access to streaming quotes, interactive charts, trades, portfolio, live options flow and more tools.
Register for free to join our community of investors and share your ideas. You will also get access to streaming quotes, interactive charts, trades, portfolio, live options flow and more tools.
market has been red hot and we have made fortunes - Boys & Girls feel so bad for all those shareholders who have been badly burned by this POS . Klug needs to go - the board needs to go and maybe then will this deal have legs. Bring back the guys who scrub toilets and clean floors to run this - lol. 1 employee who hangs up on Investors- Seizures. Seizures and more Seizures. Nothing has ever worked here. It is time- GO HOME NOW Please save your money and sell and take what you can and go buy an Ice cream cone- this one will only continue to taste like a Turd. A big juicy southern Turd . CEO should be ashamed and embarrassed. We believe he is broke - no more money from him- hence bring on the Toxic boys ! lol. bring them
Why don't you share your emails with us ? Did you ask about the name of the distributor? Did you ask where Centri is? Did you ask where Woundclot is? Did you ask about their 3a10 strategy? DId you ask about the SEizures? Did you ask about the false 12 mill press release? Did you ask about PPE sales? DId you ask about Cannibas? Did you ask about Dr. Drew? Did you ask about the toxic financings they have done? Did you ask why they exchange common stock into prefs? Did you ask if they have issues more Insider Interest Free loans? Ask the right questions. Did you ask about PCG ? Let's see what you dis ask. Send the poor shareholders your email.
Name the distributor, BAck up the 12 mill press release, Release what you gave PCG for their 107 mill shares , Dr. Drew - Where are you and where are your shares? No one here , No one believes you haven't asked for them? Is there a lawsuit coming? Let us know- CEO loves litigation . The company has been pounded and taken out to the woodshed on all litigation. Thi stime wont be different Drew.
Show the contract- Are these consignment sales ? Need details to evaluate this mess . No name on the distributor? Keep hiding. Just like on the 3a10's. https://www.globenewswire.com/news-release/2017/10/13/1145742/0/en/redhawk-engages-md-global-partners.html. DISASTER lies
Put the agreement out asap so we can see all the details- we all know these contracts with these "unknown" distributors have ZERO teeth . Who are they and put out the agreement now. Stop hiding . Putting out a 12 mill agreement without backup is very poor and some would say very dangerous . Boys & Girls will find out who they are and will cross check . U can't hide and your board needs to be extra cautious - 12 mill. lol
How u feeling Jelly? 12 mill reasons to go back home. U need us on the Wall- U want us on the wall, We are here to protect the little Investors who are constantly lied to . The little guy has no idea what a toxic financing looks like or a 3a10. CEO has put the hammer down with no regard for dilution. We are on the wall for u . 3 billion shares - it is coming.
Uber- u r so right. this one is a TURD. disaster if we can call it as we see it. 3 billion fully diluted with all the insider deals on the cap table. CEO needs to resign and the board needs to go -- seizures are unacceptable. 12 mill revenues- LOL. joke
he is owed 170 mill shares and he will get his shares one way or another
Toxic Turd 1 Employee -SAD stock price - disaster. Here comes Drew to get his 170 mill shares
dDOG - u r right again. more litigation coming and we will be watching soon for the litigation release against the COmpany from Doc Drew. Drew will sue the company so hard for fraud and the intention to never deliver the shares. Strap in DDOG
Neali- The boys and girls are licking their chops for those financials. Question is will they beat last quarters 29k in revenue? What are your thoughts? Dr. Drew will be the next bomb to drop( after the seized real estate). Company we believe will have to raise money very soon . Liabilities are piling up and more to come in a very short period. Unless we see more Insider Interest Free Loans - lol lol
Drew coming for his shares - and he will win. Boys& GIrls like him alot.
no Sweetheart - saying the opposite. CEO always sues first. but the counter suit will bury this Turd and it will bury shareholders as well. Drew will not back down. it's showtime Jelly- pull up a chair
u should be - this is a bucket of Turd . Billy, Don't you worry - CEO is a litigious money spending dream for his 3a10 lawyer. He wont give 1 share to Drew and Drew will sue his ass for everything he has. LOL. bring it lol Boys & GIrls have called Drew. Fireworks soon enough . Too bad with only 1 Employee this company has incompetence.
Toxic buyers are being let out- transfer agent has literally cleared the runway .. Sellers will be hitting this POS hard in the next several trading sessions. Jelly, Open up wide and take it all in.
Correct Seized and more bad news or no news to come. where is woundclot. It is with the 12 mill press release-lol
Everyone needs to buy as much as they can. Toxic sellers have been let out of their closet and we need all of you to buy and keep the manipulation going ... Buy Buy Buy 1 Employee lol
mens take your money and go home
Just received an email from Mr. Darcy
Stating that due diligence is still on going on the Med Tech deal. So its not dead . Hopefully we will hear something soon.
1 Employee who should be fired , 3a10's, dilution , Toxic financings , No woundclot, No Centri, England was a total BUST , has done nothing for 7 years but dilute the money and give the company away . But wait - lol. 12 mill in sales. lol PPE - disaster distraction. CAnnabis is the next distraction lol there is no money and seizures . Disaster
Stock is a disaster. Sell Sell Sell. company sells shares everyday- u should as well.
3/31/21 lol. 12 mil sales lol lol
Did the stock split 3-1 ? or did it just lose 70 % of its value . Headed lower. No sales, No Centri, 3a10's. False press releases , no 8k's. Boys & Girls are so excited to see the 10k- barely can compose themselves.
Centri is dead and has always been dead. Wake up
Thank you Sly and to all those Investors who have sent flowers and chocolates( so good) to our boys & girls for all their hard work. Their goal is simple- Transparency. 8k's, no Insider Interest Free Loans that hurt Shareholders, No 3a10's, No false press releases, No liars , No more
Nothing to update from the 1 employee wonder- sits around all day doing what? Litigating? no 8k's , no sales, just toxic debt. Where is Centri? , Woundclot, WE just see Seizures and dilution. Time for you to go to pasture - leave now and maybe just maybe the stock will rise.
Thank you SLy and to all those Investors who have sent flowers and chocolates( so good) to our boys & girls for all their hard work. Their goal is simple- Transparency. 8k's, no Insider Interest Free Loans that hurt Shareholders, No 3a10's, No false press releases, No liars , No more
has requested shares multiple times. u believe what u read from this company - LOL. lol lol. royalties? on what - lol lol lol
see u at .00011
He is owed and if he doesn't get it he will sue and put the CEO in jail for fraud. This is what we hear. More litigation coming .
Toxic sellers are pushing u around- wait until Dr. Drew drops his 170 million shares into the market. Talk about Seizures .
VRCN Notes=. Toxic Toxic garbage . only desperate companies use these. Keep buying
Boys & Girls are so excited that Seizures, 3a10's, Insider Interest Free loans , Toxic financings, False press releases, etc etc excite u !! Well Done
On November 12, 2015, we acquired certain commercial real estate from a related party that is an entity controlled by Beechwood and our Chief Executive Officer for $480,000, consisting of $75,000 of land costs and $405,000 of buildings and improvements. The purchase price was paid through the assumption by the Company of $265,000 of long-term bank indebtedness (which we refer to below as the “Note”) plus the issuance of 215 shares of the Company’s Series A Preferred Stock. The purchase price also included the cost of specific security improvements requested by the lessee.
The Note is dated November 13, 2015 and has a remaining principal amount of $216,766 as of March 31, 2021. Monthly payments under the Note are $1,962, including interest accruing at a rate of 5.95% per annum. The Note matures in June 2021 and is secured by the commercial real estate, guarantees by the Company and its wholly-owned real estate subsidiary, RedHawk Land & Hospitality, LLC, and the personal guarantee of Beechwood and the Company’s Chief Executive Officer. At the maturity of this loan, the Company expects the loan to be re-financed.
In March 2016, we issued $545,000 in principal amount of convertible promissory notes (which we refer to as the “2016 Fixed Rate Convertible Notes”). The 2016 Fixed Rate Convertible Notes are secured by certain Company real estate holdings.
The 2016 Fixed Rate Convertible Notes matured on March 15, 2021, the fifth anniversary of the date of grant and are convertible into shares of our common stock at a price of $0.015 per share. Interest accrues at a rate of 5% per annum and is payable semi-annually. The Company has the option to issue a notice of its intent to redeem, for cash, an amount equal to the sum of (a) 120% of the then outstanding principal balance, (b) accrued but unpaid interest and (c) all liquidated damages and other amounts due in respect of the 2016 Fixed Rate Convertible Notes. The Company may only issue the notice of its intent to redeem the 2016 Fixed Rate Convertible Notes if the trading average of the Company’s common stock equals or exceeds 300% of the conversion price during each of the five business days immediately preceding the date of the notice of intent to redeem. Holders of 2016 Fixed Rate Convertible Notes have the right to convert all or any portion of the 2016 Fixed Rate Convertible Notes at the conversion price at any time prior to redemption.
At March 31, 2021, and June 30, 2020 there was one remaining 2016 Fixed Rate Convertible Note outstanding with principal and accrued interest of approximately $64,000 and $62,000, respectively. This remaining 2016 Fixed Rate Convertible Note (plus accrued interest) is convertible into our common stock at a conversion rate of $0.015 per share or 4,274,512 total shares. During the nine month periods ended March 31, 2021 and 2020, we recognized approximately $2,340 and $2,000, respectively, of interest on this convertible note. Subsequent to March 31, 2021, we paid the remaining principal balance outstanding plus accrued interest.
17
During the nine month periods ended March 31, 2021 and 2020, we issued $200,000 and $832,000, respectively, in principal amount of new convertible promissory notes (which we refer to as the “2019 Fixed Rate Convertible Notes”). The 2019 Fixed Rate Convertible Notes are secured by certain Company real estate holdings. As of March 31, 2021, $1,042,000 of 2019 Fixed Rate Convertible Notes were outstanding. Subsequent to March 31, 2021, we issued an additional $150,000 in principal amount of new 2019 Fixed Rate Convertible Notes.
The 2019 Fixed Rate Convertible Notes mature on the fifth anniversary of the date of issuance and are convertible into shares of our common stock at a price of $0.015 per share and include 25% warrant coverage at $0.01 per share. The warrants expire ten years from the date of issuance. Interest accrues at a rate of 7% per annum and is payable semi-annually. The Company has the option to issue a notice of its intent to redeem, for cash, an amount equal to the sum of (a) 120% of the then outstanding principal balance, (b) accrued but unpaid interest and (c) all liquidated damages and other amounts due in respect of the 2019 Fixed Rate Convertible Notes. The Company may only issue the notice of its intent to redeem the 2019 Fixed Rate Convertible Notes if the trading average of the Company’s common stock equals or exceeds 300% of the conversion price during each of the five business days immediately preceding the date of the notice of intent to redeem. The holder of the 2019 Fixed Rate Convertible Notes has the right to convert all or any portion of the 2019 Fixed Rate Convertible Notes at the conversion price at any time prior to redemption.
18
During the nine month periods ended March 31, 2021 and 2020, we issued $268,236 and $0, respectively, in principal amount of new convertible notes (which we refer to as the “2020 Fixed Rate Convertible Notes”). As of March 31, 2021, a total of $568,235 (approximately $517,195 net of unamortized deferred loan costs of approximately $26,040 and unamortized beneficial conversion of $25,000) of 2020 Fixed Rate Convertible Notes were outstanding.
During the nine month period ended March 31, 2021, $50,000, plus accrued interest, of the 2020 Fixed Rate Convertible Notes were converted into 10,000,000 shares of common stock.
The 2020 Fixed Rate Convertible Notes accrue interest at 10% per annum, are convertible into shares of our common stock at a price of $0.005 per share, mature twelve months after issuance and are unsecured. The proceeds from the 2020 Fixed Rate Convertible Notes issued during the nine month period ended March 31, 2021 were used to repay approximately $21,000 of obligations owed on the 2019 Variable Rate Convertible Notes (including principal amount, accrued interest and prepayment penalties) and for working capital purposes. When issued, the 2020 Fixed Rate Convertible Notes had an initial conversion rate below the trading price of the Company’s common stock creating a beneficial conversion feature (“BCF”), which exceeded the total cash proceeds received from its issuance. Accordingly, at June 30, 2020, we recorded the BCF as a debt discount and additional paid-in capital of $85,000. The debt discount is being amortized over the one-year term of the note.
During the nine month periods ended March 31, 2021 and 2020, we issued $281,500 and $1,078,862, respectively, of convertible notes to third parties with variable conversion rates (“2019 Variable Rate Convertible Notes”). The 2019 Variable Rate Convertible Notes mature at various dates between April 2022 and June 2022. During the nine month periods ended March 31, 2021 and 2020, we received approximately, net of financing costs incurred, $265,000 and $960,000, respectively, in cash from the issuance of these notes. The remaining outstanding 2019 Variable Rate Convertible Notes as of March 31, 2021 have interest accruing at 12%. These notes have a variable conversion rate based on the price of the Company’s common stock.
During the nine month period ended March 31, 2021, $764,000, plus accrued interest, of the 2019 Variable Rate Convertible Notes were converted into 281,124,078 shares of common stock. Additionally, $20,737, including accrued interest and prepayment penalties, of the 2019 Variable Rate Convertible Notes were repaid.
Certain of the 2020 Fixed Rate Convertible Notes and 2019 Variable Rate Convertible Notes have maturity dates within twelve months from the balance sheet date and could be classified as a current liability. However, it is the Company’s expectation that such notes will be converted into shares, re-financed to longer terms, or paid off with the proceeds of long-term financing. Therefore, we have classified these notes as noncurrent. If we do not re-finance these convertible notes to longer terms, however, the holders of the convertible notes have the option to convert these notes into equity or hold the convertible notes to maturity.
On March 12, 2019, we obtained a $180,000 real estate loan from a financial institution. The note matured on April 1, 2020 and was extended to October 1, 2020. The Company is working on an additional extension of this loan. This real estate note is secured by certain real estate property and the personal guarantee of the Company’s Chief Executive Officer. Interest only is payable monthly and accrues at an interest rate of 12%.
Beginning in the quarter ended June 30, 2019, we entered into a series of credit financing arrangements from financing institutions by pledging various Company assets and the personal guarantee of the Company’s Chief Executive Officer. The proceeds from these credit agreements were used to pay the amounts due under the Schreiber settlement agreement more fully described in Note 8. As of March 31, 2021 and June 30, 2020, we had $137,727 and $129,389, respectively, outstanding on these loans.
8. COMMITMENTS AND CONTINGENCIES
Schreiber Litigation
On January 31, 2017, the Company and Beechwood filed suit against Daniel J. Schreiber (“Mr. Schreiber”) and the Daniel J. Schreiber Living Trust – Dtd 2/08/95 (“Schreiber Trust”) in the United States District Court for the Eastern District of Louisiana (the “Louisiana Court”) under Civil Action No. 2:2017cv819-B(3) (the “Litigation”).
Mr. Schreiber and the Schreiber Trust answered and filed a counter-claim against the Company and Beechwood and made additional claims against Mr. G. Darcy Klug (“Mr. Klug”), the Chief Executive Officer and a director of the Company, and sole owner of Beechwood, in the Lawsuit.
On March 22, 2019, the parties to the Litigation entered into a Settlement Agreement and General Release (“Settlement Agreement”) to resolve all issues arising out of the subject matter of the Litigation.
19
In consideration of the mutual promises, covenants and conditions contained in the Settlement Agreement, the parties agreed that (i) Mr. Schreiber and the Schreiber Trust would transfer all Company stock they then owned (52,377,108 common shares) to the Company and (ii) the Company would (a) make to Mr. Schreiber and the Schreiber Trust a cash payment of Two Hundred Fifty Thousand dollars ($250,000) and (b) issue two Promissory Notes, each in the principal amount of Two Hundred Thousand dollars ($200,000), one of which was due and payable on or before September 6, 2020 (“Note 1”) and the other was due and payable on or before September 5, 2021 (“Note 2”). As a result of this Settlement Agreement, the Company recorded a loss of $471,880 in the year ended June 30, 2019.
Each Promissory Note was non-interest bearing, however each (i) included a $15,000 late penalty if the principal amount was not repaid by the due date and (ii) would bear interest at a rate of 18% per annum, from the issue date, if the principal was not repaid by the 30th date after the due date.
Pursuant to a security agreement entered into between the parties, Mr. Klug and Beechwood secured the Company’s obligations under the Settlement Agreement by granting first-priority security interests in (i) 1,000 shares of Mr. Klug’s Series B Preferred Stock; and 1,473 shares of Mr. Klug’s Series A Preferred Stock, and (ii) Beechwood’s interest in the Tower Hotels Fund 2014, LLC (collectively “the Escrow Account”).
On October 11, 2019, the Schreiber Trust filed a Motion to Enforce Settlement Agreement (the “Motion”) with the Louisiana Court alleging that the Company failed to comply with certain of its obligations under the Settlement Agreement. The Motion sought to, among other things, accelerate payment of the amounts owed to Schreiber under the Settlement Agreement and collect additional amounts in interest and attorneys’ fees.
On July 17, 2020, the Louisiana Court granted Schreiber’s Motion and ordered the Company to pay to the Schreiber Trust $519,495.78 (“Judgment”) representing (i) the principal amount due on Note 1 ($200,000); (ii) the principal amount due on Note 2 ($200,000); (iii) pre-judgment interest of 18% simple interest on certain outstanding debt charged back to the date of the Settlement Agreement; (iv) $40,000.00 of attorneys’ fees (10% of the amounts due); and (v) post-judgment interest from the date of the Judgment as well as costs. The Company appealed the Louisiana Court’s ruling to the United States 5th Circuit Court of Appeals (the “Court of Appeals”).
During the three month period ended September 30, 2020, Mr. Klug and Beechwood converted the 1,000 shares of Series B Preferred Stock and the 1,473 shares of Series A Preferred Stock into 124,849,365 and 122,730,903, respectively, of the Company’s Common Stock (collectively “the Escrow Shares”) and replaced the 1,000 shares of Series B Preferred Stock and 1,473 shares of Series A Preferred Stock held in the Escrow Account with the Escrow Shares as security pursuant to the Security Agreement.
Payment of the principal amount of Note 1 was tendered by the Company to Schreiber on August 13, 2020. Notwithstanding the appeal to the Court of Appeals, the Company tendered the early repayment of the principal amount of Note 2 to Schreiber on August 24, 2020. As of March 31, 2021, the unsatisfied amount of the Judgment ($119,496) is shown as a “Settlement liability” on the consolidated balance sheet.
On September 4, 2020, the Company filed a Consent Motion to Approve Supersedeas Bond and Stay of Execution of Judgment Pending Appeal (“Motion to Approve”). On September 8, 2020, the Louisiana Court granted the Motion to Approve and the posting of a supersedeas bond (“Bond”) by the Company in the amount of $143,491 representing (i) the remaining, unsatisfied amount of the Judgment; plus (ii) post-Judgment interest of $80; plus, (iii) 20% of the combined amount ($23,915). As the Judgment was vacated on December 17, 2020, the Louisiana Court entered an order releasing the Bond and returning the aforementioned funds to the Company. The returned funds are currently held in trust and are included in “Prepaid expenses” on the consolidated balance sheet.
On November 12, 2020, the Court of Appeals issued a decision vacating the Judgment and remanding the case to the district court.
The 14 day period to seek rehearing from the Court of Appeals passed on November 26, 2020, with no petition filed by Schreiber; thereupon, the decision and judgment of the Court of Appeals became final. By applicable rule, the mandate of the Court of Appeals issued 8 calendar days thereafter, on December 4, 2020.
The Louisiana Court also ordered the Company to file a Sur-Reply Brief. The Louisiana Court had previously denied the Company’s motion for leave to file a sur-reply brief, after Schreiber had presented new arguments and evidence for the first time in his Reply Brief. When the Louisiana Court ruled in Schreiber’s favor based solely on these new materials, the Court of Appeals reversed, ruling its denial was an abuse of discretion. This order of the Louisiana Court was consistent with the ruling of the Court of Appeals.
The Louisiana Court also sua sponte ordered that Schreiber be allowed to file a response to the Company’s Sur-Reply. Schreiber had not requested or moved to be allowed to file a response.
Regardless, the parties each timely filed their respective pleadings in accordance with the order. Both parties argued in favor of their position and claimed to be entitled to an award of the reasonable attorneys’ fees and costs they incurred in connection with this litigation should the Louisiana Court rule in their favor.
The Company is now awaiting a decision from the Louisiana Court. As previously and consistently expressed, the Company believes Schreiber’s Motion is without merit and intends to continue to vigorously defend against it accordingly, if and as necessary.
20
Consultant Agreement
On July 19, 2019 (the “Effective Date”), RedHawk and its wholly-owned subsidiary, RedHawk Medical Products & Services, along with other affiliated entities, entered into a Consultant Agreement (“Agreement”) with Drew Pinsky, Inc. f/s/o Dr. Drew Pinsky (“Consultant”), for Consultant to be the exclusive spokesperson for the Company’s Sharps Needle and Destruction Device (“SANDD”) mini™, SANDD Pro™ and any related products and/or accessories (“Products”) for an initial period of two (2) years (“Initial Period”), under the terms and conditions described in the Agreement. At the end of the Initial Period, there shall be an automatic, immediately consecutive two (2) year extension period unless DPI, within 60 days of the expiration of the Initial Period, provides written notice of its intention not to extend the Agreement.
Under the Agreement, the Company agreed to pay Consultant a royalty equal to 3% of the “Net Sales”, as defined in the Agreement, of the Products but in no event will the royalty be less than $3.50 per SANDD mini™ unit sold and $13.50 per SANDD Pro™ unit sold. As of March 31, 2021, approximately $800 of royalties have been paid to the Consultant and an additional $850 of royalties are included in accrued liabilities on the unaudited consolidated balance sheet.
Pursuant to the Agreement, the Company agreed to issue to the Consultant 68,700,000 shares of the Company’s common stock, which was equal to approximately 5% of the Company’s outstanding common stock on a fully diluted basis as of the Effective Date. Further, the Company has agreed to issue to the Consultant, the later of one year after the Effective Date or upon Consultant’s request, an additional 68,700,000 shares of the Company’s common stock, unless Consultant has provided the Company with written notice of its intention not to extend the Initial Period. As of the date of this Quarterly Report on Form 10-Q, the Company has not yet received notice from the Consultant requesting issuance of any of the shares pursuant to the Agreement.
9. STOCKHOLDERS’ EQUITY
Preferred Stock
Effective November 12, 2015, 2,750 shares of our authorized Preferred Stock were designated as Series A 5% Convertible Preferred Stock, originally with a $1,000 stated value (which we refer to as “Series A Preferred Stock”). The holders of the Series A Preferred Stock are entitled to receive cumulative dividends at a rate of 5% per annum, payable quarterly in cash, or at the Company’s option, such dividends shall be accreted to, and increase, the stated value of the issued Series A Preferred Stock (which we refer to as “PIK”). Holders of the Series A Preferred Stock are entitled to vote on all matters submitted to stockholders at a rate of ten votes for each share of common stock into which the Series A Preferred Stock may be converted. After six months from issuance, each share of Series A Preferred Stock is convertible, at the option of the holder, into the number of shares of common stock equal to the quotient of the stated value, as adjusted for PIK dividends, by $0.015, as adjusted for stock splits and dividends.
Effective February 16, 2016, 1,250 shares of our authorized Preferred Stock were designated as Series B 5% Convertible Preferred Stock, originally with a $1,000 stated value (which we refer to as “Series B Preferred Stock”). The holders of the Series B Preferred Stock are entitled to receive cumulative dividends at a rate of 5% per annum, payable quarterly in cash, or at the Company’s option, such dividends shall be accreted to, and increase, the stated value of the issued Series B Preferred Stock (which we refer to as “PIK”). Holders of the Series B Preferred Stock are entitled to vote on all matters submitted to stockholders at a rate of ten votes for each share of common stock into which the Series B Preferred Stock may be converted. After six months from issuance, each share of Series B Preferred Stock is convertible, at the option of the holder, into the number of shares of common stock equal to the quotient of the stated value, as adjusted for PIK dividends, by $0.01, as adjusted for stock splits and dividends.
On August 4, 2020, Mr. Klug and Beechwood converted 1,000 shares of Series B Preferred Stock and the 1,473 shares of Series A Preferred Stock into 124,849,365 and 122,730,903 shares, respectively, of the Company’s Common Stock. On September 28, 2020, the Escrow Account in the Schreiber Litigation was dissolved. As a result, on October 6, 2020, the Company’s Board of Directors, Mr. Klug and Beechwood, agreed to exchange 124,849,365 and 122,730,903 of the Company’s Common Stock for 1,000 shares of Series B Preferred Stock and the 1,473 shares of Series A Preferred Stock, respectively. On November 4, 2020, the Company agreed to exchange from 122,730,903 shares of the Company’s common stock held by Beechwood for 1,473 shares of Series A Preferred Stock, with a stated value of $1,133.81 per share. During the quarter ended March 31, 2021, the Company completed the exchange with Beechwood of 122,730,903 shares of the Company’s common stock in exchange for 1,473 shares of the Company’s 5% Series A Preferred Stock.
During the nine month periods ended March 31, 2021 and 2020, we recognized $99,728 and $168,068, respectively, of related preferred stock dividends.
21
Warrants
On June 20, 2019, RedHawk entered into a Stock Exchange Agreement (“Exchange Agreement”) with Beechwood. G. Darcy Klug, the Company’s Chairman of the Board, Chief Executive Officer and Chief Financial Officer, is the sole member and manager of Beechwood. Under the Exchange Agreement, the Company exchanged 113,700,000 shares of the Company’s common stock for 1,277 shares of the Company’s 5% Series A Preferred Stock and a Stock Purchase Warrant (“Warrant”) to acquire 113,508,450 shares of common stock at an exercise price of $0.005 per share. The Warrant expires on June 20, 2029.
In conjunction with the 2019 Fixed Rate Convertible Notes, the holders of the 2019 Fixed Rate Convertible Notes were issued warrants to purchase 26,050,000 shares of the Company’s common stock at a price of $0.01 per share. The warrants expire at various dates between August 2029 and August 2030.
In total, as of March 31, 2021, the Company had warrants to purchase 139,558,450 shares of common stock outstanding with a weighted average exercise price of $0.006 and a weighted average remaining life of 8.31 years.
22
10. ASSET IMPAIRMENTS
In the year ended June 30, 2020, we recognized several asset impairments totaling $214,675. This impairment was comprised of the following:
? The resort property owned by the real estate limited partnership, in which we have an ownership interest in, is located in Hawaii. As a result of the COVID-19 pandemic, the tourism industry in Hawaii has been adversely affect and the resort was temporarily closed for an extended period.
? We have certain inventory located in the United Kingdom. As a result of the COVID-19 pandemic, the United Kingdom has been in partial or complete lockdown for an extended period and we have been unable to market the inventory. The inventory is still salable but additional costs and/or price reductions may be necessary.
? A third party from which we had agreed to acquire the exclusive manufacturing and distribution rights to certain needle incineration intellectual properties breached that agreement.
During the quarter ended March 31, 2021, we issued the following securities:
? In separate transactions, we issued a total of 76,733,153 shares of common stock to different holders of certain 2019 Variable Rate Convertible Notes upon the conversion of $181,000 of principal amount of such notes, plus accrued interest; and
? We issued 10,000,000 shares of common stock to holders of certain 2020 Fixed Rate Convertible Notes upon the conversion of $50,000 of principal amount of such notes, plus accrued interest; and
? We issued 55,916,667 shares of common stock to certain related party note holders of certain interest free advances upon the conversion of $142,000 of principal amount of such advances; and
?
We issued 6,250,000 shares of common stock to certain members of our board of directors as compensation.
We claim an exemption from registration provided by Section 3(a)(9) of the Securities Act for such issuances upon conversion of our convertible securities, as the securities were exchanged by us with our existing security holders in a transaction where no commission or other remuneration was paid or given directly or indirectly for soliciting such exchange.
?
During the quarter ended March 31, 2021, we sold $175,500 in principal amount of new 2019 Variable Rate Convertible Notes. These notes have a variable conversion rate based on the price of the Company’s common stock.
? Subsequent to March 31, 2021, we sold $150,000 in principal amount of new 2019 Fixed Rate Convertible Notes (See Note 7 in the notes to the unaudited consolidated financial statements included above), and in connection therewith, warrants to purchase 3,750,000 shares of common stock at $0.01 per share. The proceeds were used to repay the principal balance outstanding, including accrued interest, on the remaining 2016 Fixed Rate Convertible Note. If the warrants to purchase 3,750,000 shares of common stock at $0.01 per share were exercised in full, the maximum number of shares of common stock issuable upon exercise thereof would be 3,750,000 shares of common stock.
The issuances described above were exempt from registration pursuant to Section 4(a)(2), Rule 506 of Regulation D and/or Regulation S of the Securities Act, since the foregoing issuances did not involve a public offering, the recipients took the securities for investment and not resale, we took take appropriate measures to restrict transfer, and the recipients were (a) “accredited investors”; (b) had access to similar documentation and information as would be required in a Registration Statement under the Securities Act; (c) were non U.S. persons; and/or (d) were officers or directors of the Company. The securities are subject to transfer restrictions, and the certificates evidencing the securities contain an appropriate legend stating that such securities have not been registered under the Securities Act and may not be offered or sold absent registration or pursuant to an exemption therefrom. The securities were not registered under the Securities Act and such securities may not be offered or sold in the United States absent registration or an exemption from registration under the Securities Act and any applicable state securities laws.
We hope u buy and buy and buy because that will be the only way you learn a hard expensive lesson. Yes keep buying
Uber- SNDD wasted huge money in fees and Sheriff's costs on the SEizure. Disaster
loaded with TOxic Debt , 1 Employee and no sales. 29k sorry
throw him a life raft so he can start resuscitating this dog of a stock. 12 mill revenues and your 8k - where are u. please put it out. lol
Reaper- Happy 4th to all the lenders who received Interest Insider Free Loans from the Co . Fireworks should start soon- the boys & girls believe. Happy 4th as well to all recipients of the 3a10 proceeds and let us not forget happy 4th to All the Toxic lenders that have given millions of dollars to keep this dog afloat. and Happy 4th to Dr. Drew and his 170 mill shares.
Jelly- We are going to miss u over the holidays just like we miss the 3a10 transactions