OUR BOYS AND GIRLS JUST FOUND THIS - CASE 2017 CA 5554.
RedHawk Initiates Plan to Eliminate Debt
Transaction Continues Company Goal to Restructure its Balance Sheet Without Dilution
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December 13, 2017 15:00 ET | Source: RedHawk Holdings Corp.
LAFAYETTE, La., Dec. 13, 2017 (GLOBE NEWSWIRE) -- RedHawk Holdings Corp. (OTCQB:IDNG) (“RedHawk” or the “Company”) announced today that it has received a favorable order from the Circuit Court of the Twelfth Judicial Circuit Court in the State of Florida (Case No. 2017 CA 5554) granting the Company approval of a settlement transaction (the “Transaction”) for RedHawk to issue up to $117,000 of its common stock (“Issued Shares”) in full satisfaction of up to $153,000 of 3rd party trade obligations and broker fees. The Issued Shares are exempt from registration pursuant to Section 3(a)(10) of the Securities Act of 1933, as amended, and will be issued at a 35% discount to market, as defined.
Simultaneous with announcing the Transaction, RedHawk said it has entered into a common stock purchase and sale agreement (the “Purchase and Sale Agreement”) with Beechwood Properties, LLC (“Beechwood”) who beneficially owns approximately 60% of the Company’s outstanding common stock. Mr. G. Darcy Klug, the Company’s Chairman of the Board and Chief Financial Officer owns and controls Beechwood.
Under the terms of the Purchase and Sale Agreement, RedHawk has agreed to purchase from Beechwood a like number shares (the “Beechwood Shares”) to be issued under the Transaction. The purchase price for the Beechwood Shares is also $117,000 and will be paid with the issuance of a promissory note (the “Note”) to Beechwood. The Note will accrue interest at 5% per annum and will mature three years from date of issuance. After two years from its issuance, the Note and any accrued interest, will become convertible into the Company’s Series A Preferred Stock.
The Company said the Transaction and the Sale and Purchase Agreement were entered into with the objective of continuing to restructure the Company’s balance sheet by eliminating approximately $153,000 of 3rd party debt from the balance sheet, preventing shareholder dilution with the Transaction, and preserving cash to be used for future operations and strategic transactions. Additionally, RedHawk said, upon completion of the Transaction, the Beechwood Shares will be returned into the Company’s treasury with no increase in the number of outstanding shares.
