Seahawk Gold Corp. Announces Change of Business

Rhea-AI Summary

Seahawk Gold Corp. (CSE: SEAG, OTC Pink: SEHKF) announced the acquisition of FlexGPU, an AI data center developer. This transaction will mark a fundamental business change and requires Seahawk's shareholder approval. The deal involves issuing 10 million common shares at $0.20 each and an additional 20 million performance-based shares, also at $0.20 each, to FlexGPU shareholders. FlexGPU will raise $6 million via convertible debt financing, which Seahawk will assume. Post-acquisition, most Seahawk directors will resign, except for Giovanni and Bruno Gasbarro. Seahawk will continue to hold its mineral properties and seek buyers post-closing. The deal is subject to due diligence, regulatory, and shareholder approvals, and trading in Seahawk’s stock remains halted.

Positive

• Seahawk acquires FlexGPU, involving a business shift to AI data centers.
• Issuance of 10 million shares at $0.20 and 20 million performance-based shares at $0.20.
• FlexGPU will raise $6 million through convertible debt financing.

Negative

• The transaction requires Seahawk’s shareholder approval and multiple regulatory approvals.
• Trading in Seahawk’s stock is halted until transaction completion.
• Significant leadership changes with most directors resigning post-acquisition.

Vancouver, British Columbia--(Newsfile Corp. - June 26, 2024) - Seahawk Gold Corp. (CSE: SEAG) (OTC Pink: SEHKF) ("Seahawk") announces that it has entered into a letter agreement on June 25, 2024 with FlexGPU, an AI data center development company, which will involve the acquisition by Seahawk of all of the issued and outstanding shares of FlexGPU (the "Transaction"). On completion of the Transaction, Seahawk will carry on the business currently conducted by FlexGPU. The Transaction will constitute a change of business and a Fundamental Change under the policies of the Canadian Securities Exchange (the "CSE"), and will require the approval of Seahawk's shareholders.

The letter agreement will be replaced by a definitive agreement between the parties setting out additional terms relating to the Transaction standard for a transaction of this nature (the "Definitive Agreement"), but is a binding agreement between the parties to undertake the Transaction. Seahawk following completion of the Transaction is referred to in this release as the "Resulting Issuer".

Seahawk's CEO Giovanni Gasbarro commented, "I am very excited for what potential this Transaction brings to our shareholders, while giving the Company time to take care of its mineral assets."

Summary of the Transaction

Pursuant to the Transaction, Seahawk will acquire all of the issued and outstanding shares of FlexGPU by issuing an aggregate of 10,000,000 common shares of Seahawk ("Consideration Shares") to FlexGPU's current shareholders (the "Vendors") in exchange for their FlexGPU shares. The Consideration Shares will be issued at a deemed price of $0.20 per Consideration Share.

Seahawk will issue an additional 20,000,000 common shares of Seahawk ("Performance Shares") to the Vendors at a deemed price of $0.20 per Performance Share. The Performance Shares will be held in escrow for release to the Vendors upon the Resulting Issuer satisfying certain performance-based release conditions to be set out in the Definitive Agreement. If the release conditions in the escrow agreement are not met, the Performance Shares will be returned to the Resulting Issuer and cancelled and returned to treasury. The Vendors may not exercise the voting rights attaching to the Performance Shares until they are released from escrow.

Prior to closing of the Transaction (the "Closing"), FlexGPU will complete a convertible debt financing to raise gross proceeds of $6,000,000. Seahawk will assume this debt at Closing, and the debt following such assumption will be convertible into Resulting Issuer shares at a price of $0.30 per share.

All directors' options of Seahawk will be retained by their respective holders, and subject to their terms, may be exercised prior to or following the Closing.

Following the Closing, other than Giovanni Gasbarro and Bruno Gasbarro, who shall continue to act as directors of the Resulting Issuer for a transition period to be agreed, all existing directors and officers of Seahawk will resign in favour of nominees of FlexGPU and as will be more particularly specified in the required information circular prepared in connection with the Transaction.

The Resulting Issuer will continue to hold the mineral properties currently held by Seahawk following Closing, and will seek to find a buyer for these properties as soon as reasonably practicable following the Closing.

The Transaction is subject to the satisfactory completion of due diligence by Seahawk, the approval of the CSE and any other regulatory body having jurisdiction, and the approval of Seahawk's shareholders.

The agreement may be terminated by Seahawk at any time if it is not satisfied with the results of its due diligence investigations of FlexGPU, and may be terminated by either party if (a) the Definitive Agreement has not been entered into September 30, 2024; (b) the Closing has not taken place by November 30, 2024; or (c) the CSE indicates that it will not approve the Transaction.

Trading in Seahawk's stock was halted on the parties agreeing to the Transaction on June 25, 2024, and will remain halted. Further updates will be provided by Seahawk as it works towards the completion of the Transaction.

About Seahawk Gold Corp.

Seahawk Gold Corp. is a publicly traded Canadian resource exploration company trading in Canada (CSE: SEAG), the U.S. (OTC Pink: SEHKF). Seahawk is the 100% owner four properties along the Urban-Barry Greenstone Belt in the Abitibi sub province of mining friendly Quebec, Canada.

For more information, please contact Seahawk Gold Corp. - seahawkgoldcorp.com

Giovanni Gasbarro
CEO and Director at 1-604-939-1848

Mitchell E. Lavery, P.Geo.
President and Director at 1-613-298-1596

Neither the Canadian Stock Exchange nor its Regulation Services Provider (as that term is defined in the policies of the Canadian Stock Exchange) accepts responsibility for the adequacy or accuracy of this release.

This news release does not constitute an offer to sell or a solicitation of an offer to buy any of the securities in the United States. The securities have not been and will not be registered under the United States Securities Act of1933, as amended (the "U.S. Securities Act") or any state securities laws and may not be offered or sold within the United States or to U.S. Persons unless registered under the U.S. Securities Act and applicable state securities laws or an exemption from such registration is available.

To view the source version of this press release, please visit https://www.newsfilecorp.com/release/214465

FAQ

What is the recent business change announced by Seahawk Gold Corp. (SEHKF)?

Seahawk Gold Corp. announced the acquisition of FlexGPU, marking a shift in business focus to AI data centers.

How many shares will Seahawk Gold issue for the FlexGPU acquisition?

Seahawk Gold will issue 10 million common shares and 20 million performance-based shares for the acquisition.

What is the value of the shares Seahawk Gold is issuing for the FlexGPU acquisition?

The shares are valued at $0.20 each.

What financing will FlexGPU complete before the Seahawk acquisition?

FlexGPU will complete a $6 million convertible debt financing.

What changes will occur to the Seahawk Gold Corp. leadership post the FlexGPU acquisition?

Most directors will resign except Giovanni and Bruno Gasbarro, who will stay on for a transitional period.

What is the condition of Seahawk Gold's stock trading during the transaction announcement?

Trading in Seahawk Gold's stock is halted and will remain so until further updates.