FOR IMMEDIATE RELEASE NOVEMBER 9, 2015
Daniel J. Schreiber, CEO
G. Darcy Klug, CFO
REDHAWK TO ACQUIRE STAKE IN EUROPEAN PHARMA COMPANY
Youngsville, Louisiana (OTC: IDNG) – RedHawk Holdings Corp. (“RedHawk” or “Company”) announced today that it has entered into a non-binding Letter of Intent (“LOI”) to acquire a 25% ownership stake in a joint venture (the “Joint Venture”) between EcoGen Europe (“EcoGen”) and a wholly-owned medical subsidiary of RedHawk. Under the LOI, the Company would have the option to increase its ownership position in the Joint Venture to 49%.
EcoGen holds distribution rights in a number of European countries for the patented anti-infection product Zonis® and the manufacturing rights to a number of widely prescribed generic drugs sold in the United Kingdom.
In exchange for its 25% ownership stake, the Company will issue to EcoGen 100 million restricted shares of RedHawk common stock. Pursuant to the terms of the LOI, the restricted shares would vest ratably as the Joint Venture achieves certain EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization) milestones. Vesting would conclude upon the earlier of the Joint Venture attaining approximately $100 million of cumulative EBITDA or seven (7) years from the closing date.
The Company intends to complete the definitive purchase agreement by December 31, 2015 but in no event later than March 31, 2016. The transaction is contingent upon, among other things, approval by RedHawk’s board of directors, the negotiation, acceptance and execution of a definitive purchase agreement, acceptance and approval by the shareholders of EcoGen, satisfactory completion of legal and financial due diligence, and the closing of acceptable financing or the receipt of additional equity capital, if necessary.
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Investors are cautioned that forward-looking statements are inherently uncertain. Actual performance and results may differ materially from that projected or suggested herein due to certain risks and uncertainties. In evaluating forward-looking statements, you should consider the various factors which may cause actual results to differ materially from any forward-looking statements including those listed in the “Risk Factors” section of our latest 10-K report. Further, the Company may make changes to its business plans that could or will affect its results. Investors are cautioned that the Company will undertake no obligation to update any forward-looking statements.