Seahawk enters LOI to acquire Redline U.S. subsidiary

Executive Summary

• Seahawk Ventures Inc. has entered into a Letter of Intent (LOI) to acquire a U.S. subsidiary of Redline Minerals Inc., which holds interests in four gold and zinc exploration properties in Arizona and New Mexico.
• The transaction constitutes a fundamental change under Canadian Securities Exchange (CSE) policies, requiring shareholder approval and resulting in the reactivation of Seahawk as an exploration issuer.
• Consideration involves the issuance of 15.5 million common shares at a deemed price of 40 cents per share, subject to a three-year escrow arrangement.

Key Details

• Transaction Structure: Seahawk will acquire the issued and outstanding securities of a U.S. subsidiary of Redline Minerals Inc. (a private B.C. company).
• Consideration: Seahawk will issue an aggregate of 15.5 million common shares.
• Deemed Price: 40 cents per share.
• Escrow Terms: The consideration shares are subject to a three-year escrow with releases of 10% upon closing and 15% every six months thereafter.
• Board Rights: Upon achieving certain-to-be-negotiated milestones, Redline has the right to appoint two individuals to the board of Seahawk.
• Timeline: The LOI is preliminary; a definitive agreement is expected on or before December 26, 2025.
• Shareholder Approval: Required due to the fundamental change status; to be sought via written consent or a future shareholders' meeting.
• Trading Status: Trading in Seahawk common shares is currently halted (previously halted due to terminated transactions with Alluvial Capital Corp. and Flex GPU Inc.). Trading is expected to resume later in the week. Upon execution of a definitive agreement, trading will be halted again until required documentation is filed with the CSE.
• Financing Component: Seahawk intends to raise up to $2 million through a non-brokered financing of up to 5 million units at 40 cents per unit.
  • Unit Composition: One common share and one-half of one share purchase warrant.
  • Warrant Terms: Each whole warrant entitles the holder to acquire one common share at $0.80 per share for a period of one year.
  • Hold Period: Four months and one day from issuance.
  • Use of Proceeds: Exploration activities, reviewing additional mineral property acquisition opportunities, and general working capital.
• Target Assets (U.S. Co.):
  • McNary Property: Gold exploration project, 31 staked mineral claims in Arizona.
  • Boston-Arizona Property: Zinc-polymetallic exploration project, 6 staked mineral claims in Arizona.
  • Lonepine Property: Gold-tellurium exploration project, 16 staked mineral claims in New Mexico.
  • Winston Property: Gold-silver exploration project, 15 staked mineral claims in New Mexico.
• Management: Current directors and management of Seahawk are expected to remain in place. Redline may select two additional nominees to the board.
• Name Change: Seahawk previously announced an intention to change its name to Seahawk Gold Corp. (unrelated to this transaction).

Notable Quotes

• No direct quotes from the CEO/President were included in the provided text.