RedHawk Holdings Corp.

Auditor MaloneBailey resigned on July 28, 2022, only about 19 months after being hired. The company says it is delinquent on its annual report for the year ended June 30, 2021 and on quarterly reports through March 31, 2022, and has announced no timetable to catch up. It says it continuously weighs the cost and benefit of staying a public OTC-Pink company and would strongly consider re-engaging MaloneBailey once it sets a timetable. No disagreements with the auditor were reported. For shareholders, no current audited financials are available.

auditor change

The Schreiber dispute is settled. After the Louisiana court ordered payments of $101,490.27 (Sept 2021) and $85,035.64 (Jan 2022) and the company appealed to the 5th Circuit, on February 16, 2022 the company agreed to pay Schreiber $150,000 in total ($28,195.56 by wire plus release of the $121,804.44 bond) with mutual broad releases. The company says that, once the court dismisses the case with prejudice, this should end the matter, resolving the interest and attorneys' fees appeal open since 2020.

material agreement

Auditor Postlethwaite & Netterville resigned on December 31, 2020, and the audit committee hired MaloneBailey on January 4, 2021 for the year ending June 30, 2021. P&N's reports for fiscal 2019 and 2020 carried going-concern doubt, and P&N told the company its internal controls were not adequate to produce reliable financial statements due to previously disclosed material weaknesses. The filing reports no disagreements with P&N. This continues the company's long-running going-concern doubt and its history of auditor changes.

auditor change

On November 4, 2020 RedHawk agreed to buy 122,730,903 common shares from Beechwood Properties in exchange for 1,473 shares of 5% Series A Preferred Stock (stated value $1,133.81 each). Beechwood is solely owned by Chairman/CFO G. Darcy Klug, making this another related-party swap, following the October 2020 Series B exchange. The Series A converts into common at $0.015 after six months and carries 10 votes per underlying common share; completion is expected in the quarter ending December 31, 2020. The company says it wants the shares available for future issuance.

capital raising announcement

RedHawk agreed on October 6, 2020 to buy 124,849,365 of its own common shares from Beechwood Properties in exchange for 1,000 new shares of 5% Series B Preferred Stock (stated value $1,248.49 each). Beechwood is solely owned and managed by Chairman/CFO G. Darcy Klug, so this is a related-party deal. The Series B converts into common at $0.015 after six months and carries 10 votes per underlying common share; the company says holding the repurchased shares available for future issuance better positions it for growth. The purchase is expected to complete in the quarter ending December 31, 2020. This swaps common stock held by the insider for convertible preferred, and the filing does not say what the preferred would convert into in share terms beyond the formula.

capital raising announcement

On September 16, 2019 the company sold $500,000 of new convertible notes in a private offering: five-year, 7% interest paid semi-annually, convertible at $0.015 per share and secured by certain company real property. Buyers also got 10-year warrants for 12,500,000 shares at $0.01. The company says proceeds will retire existing debt and provide working capital, and it intends to offer a further $500,000 of notes, so conversion and warrants add dilution potential and real property is now pledged.

debt financing

On July 19, 2019 the company and its medical subsidiary signed a two-year consultant agreement (auto-extending two years unless DPI gives notice) naming Dr. Drew Pinsky, through Drew Pinsky, Inc., exclusive spokesperson for the SANDD mini and SANDD Pro needle destruction devices (the Disintegrator assets bought in December 2015). He gets a 3% royalty on net sales (minimum $3.50 per mini and $13.50 per Pro), 68,700,000 shares within 30 days (about 5% fully diluted), and another 68,700,000 shares a year later unless notice not to extend is given. This brings notable dilution in exchange for marketing support.

material agreement

On June 20, 2019 the company bought 113,700,000 of its own common shares from Beechwood (controlled by Klug) in exchange for 1,277 Series A Preferred shares and a warrant for 113,508,450 common shares at $0.005, expiring June 20, 2029. At the same time, holders of $574,250 of 5% convertible notes (including interest) converted them into 114,849,929 common shares. The common share count changes little overall, but Beechwood now holds more preferred stock (with ten votes per underlying common share) and a large warrant, adding to dilution potential and related-party concentration.

capital raising announcement

On March 22, 2019 the company, Beechwood and Klug settled the Louisiana and California lawsuits with former CEO Daniel Schreiber and his trust. Schreiber must hand back all his 52,377,108 RedHawk shares; RedHawk pays $250,000 in cash and issues two $200,000 non-interest notes due September 6, 2020 and September 5, 2021 (with a $15,000 late penalty and 18% interest if overdue). Klug and Beechwood pledged Klug's 1,000 Series B and 1,473 Series A shares and Beechwood's interest in Tower Hotels Fund 2014 as security, and RedHawk can buy out both notes for $300,000 within 180 days of the Security Agreement. This ends the dispute that began with the January 2017 suit, and the returned shares reduce shares held outside the company.

debt financing

On December 11, 2017 the company completed a share transfer deal with Scarlett Pharma, Warwick Healthcare and their shareholders. Its UK subsidiary RedHawk Pharma took on about $370,000 of Warwick's obligations to EcoGen Europe in return for 247,269 EcoGen preference shares, 10,000,000 RedHawk shares surrendered by Scarlett and some cash from the shareholders. RedHawk Pharma now holds about $545,000 of EcoGen preference shares and 75% of EcoGen's common shares, and the 10,000,000 shares go back to the company's treasury; this follows the March 2016 initial EcoGen investment and the European pharmaceutical acquisition thread.

material agreement

On December 29-31, 2015 the company completed several deals with Beechwood (owned by CFO G. Darcy Klug): 280,000 Towers Hotels Fund 2013 units for 625 Series A shares ($625,000), a Youngsville rental property for 300 Series A shares ($300,000), and about $1.86 million of cash and securities for 1,000 new Series B Preferred shares plus assumption of a Regions Bank line of credit (balance $980,000, matures September 2016). Beechwood also converted its $100,000 line of credit into 100 Series A shares. Separately, the company acquired the Disintegrator needle destruction unit and Carotid Artery Non-Contact Thermometer assets from Big Horse Holdings and Jason Roth for 60,000,000 restricted common shares, subject to product-development milestones. Series B converts after six months at $0.01 per share; the press release says Beechwood owns about 55.8% of the common stock. This continues the move into real estate and medical devices, with heavy dilution potential and related-party concentration.

asset acquisition disposition

The company created a Series A 5% Convertible Preferred Stock (2,000 shares authorised; convertible after six months at $0.015 per common share; ten votes per common share into which it converts). It bought commercial real estate for $480,000 from Beechwood Properties, an entity controlled by CFO G. Darcy Klug, by assuming a $265,000 bank loan (5.95%, matures June 2021) and issuing 215 Series A shares. It also set up a $100,000 related-party line of credit with Beechwood (5%, due October 31, 2016, convertible into Series A). The quarter to September 30, 2015 showed a net loss of $108,404 versus $46,171 a year earlier. Related-party dealings and the convertible preferred create dilution and conflict-of-interest considerations.

asset acquisition disposition

The company's interests in four Pottawatomie County, Oklahoma wells were assigned to operator Nitro Petroleum for $10, with Nitro taking over all liabilities under the joint operating agreement, including $57,628 of accrued expenses. This completes the exit from oil and gas; the wells were already reported as discontinued operations. A press release reports a net loss of $105,614 for the five months to June 30, 2015, says the name will change to RedHawk Holdings Corp. (symbol HAWC), and describes targeted acquisitions (Lafayette, Louisiana property and an interest in the Naniloa Hilo Resort in Hawaii) that remain subject to due diligence and approvals. David Kleinhandler was appointed a director, unpaid.

asset acquisition disposition

On November 12, 2014 the company sold 14,905,918 common shares plus warrants for up to 7,452,959 shares (exercise price $0.005, two years) to two accredited investors for $50,000, receiving $49,900 net. This is a large share issuance at a very low price relative to the 2012 sales at $0.90-$2.50, so it dilutes existing holders. The company also moved its address to St. Louis, Missouri.

capital raising announcement

The company reported that, effective April 1, 2014, all oil and gas leases on the 1,400-acre Coleman County South Property (received in the February 2013 settlement with MontCrest and Black Strata) have expired. Management chose not to renew them because of a recent Asset Purchase Agreement with American Medical Distributors, LLC and a decision to focus on a medical device distribution business; the company says it has no outstanding obligations under the leases or the settlement. This ends the Texas acreage and marks a shift away from oil and gas.

asset acquisition disposition

On February 28, 2013 the company settled with MontCrest Energy and Black Strata, handing MontCrest its 25% working interests in Wells 105, 106, 113 and 115 in Coleman County, Texas. In return it received a 100% interest in about 1,400 acres of the Coleman County South Lease held by Black Strata. This reverses the 2012 well-by-well purchases into acreage; the filing does not say why the settlement was reached.

material agreement

On June 8, 2012 the company signed a joint development and operating agreement with MontCrest Energy Properties, MontCrest Energy, and Black Strata, LLC, buying a 12.5% working interest for $90,784.50 in an approximately 2,421-acre area in Coleman County, Texas, with an option on another 12.5%. This deepens its Coleman County position with the same partner.

material agreement

On May 24, 2012 the company signed a financing agreement under which one investor will provide up to $1,000,000 in advances until May 24, 2013, extendable by up to 12 months. For each advance the company issues shares priced at 90% of the average closing price over the prior five banking days, so any money drawn is paid for with new shares.

material agreement

Effective March 29, 2012 the company bought a 5% working interest (70% net revenue interest) in a two-well drilling program in Coleman County, Texas from MontCrest Energy, Inc. for $115,000. The Vaughn-MEI #106 and Shields-MEI #105-H wells are not yet producing, so this is a drilling-stage bet rather than existing production; it is the company's second oil and gas property after the Quinlan Lease.

asset acquisition disposition

The company, now named Independence Energy Corp. (renamed from Oliver Creek Resources in August 2008), closed the purchase of a 2.5% interest in the Quinlan Lease in Pottawatomie County, Oklahoma from Wise Oil and Gas LLC on December 15, 2011, and a further 2.5% on December 23, 2011, for a total of 5%. It paid $15,616 per 1% of interest, and says it began earning revenue from the operating well on the property; this is its first producing oil and gas interest described in the filings so far.

asset acquisition disposition