Blackhawk Resource Provides Update on Acquisitions

CALGARY, Alberta, May 14, 2019 /PRNewswire/ -- Blackhawk Resource Corp. (the "Corporation" or "Blackhawk") (CSE: BLR), is pleased to provide an update on its previously announced transaction with CFPM Management Services Ltd. ("CFPM"), which operates under the name, "The Green Room".

Blackhawk and CFPM have reached an agreement to restructure the proposed transaction, such that Blackhawk now proposes to acquire the rights to a lease for a retail cannabis location in Nelson, British Columbia, as well as a database of potential retail cannabis customers (the "Acquired Assets").  In order to facilitate the transaction, Blackhawk will acquire 1202465 B.C. Ltd. (the "AcquisitionCo") which is owned by the existing shareholders of CFPM Management Services Ltd.  Following this assignment, Blackhawk has entered into a letter of intent, dated effective May 13, 2019, pursuant to which Blackhawk proposes to acquire all of the outstanding share capital of AcquisitionCo in consideration for the issuance of 20,000,000 common shares of Blackhawk ("Consideration Shares").

Each of Blackhawk, CFPM and AcquisitionCo are at arms'-length.  The issuance of the Consideration Shares to the existing shareholders of AcquisitionCo is not expected to result in a change of control of Blackhawk.  Completion of the transaction, and the acquisition of all of the outstanding share capital of AcquisitionCo, remains subject to completion of filings with the Canadian Securities Exchange, and such other conditions as are customary in transactions of this nature.

Blackhawk also announces that the previously announced financing has been reduced in magnitude due to the changes in the proposed transaction.  It is now expected Blackhawk will complete a private placement of up to 20,000,000 common shares at a price of $0.05 per share for gross proceeds of approximately $1,000,000.  The proceeds of the financing are expected to be used for strategic growth initiatives, working capital and general corporate purposes.

All securities to be issued in connection with the financing will be subject to a four-month-and-one-day statutory hold period in accordance with applicable securities laws.  Assuming that the Consideration Shares are issued, and the financing is fully subscribed, there will be 81,196,374 common shares of Blackhawk outstanding. 

NOT FOR DISSEMINATION IN THE UNITED STATES OR THROUGH U.S. NEWSWIRES

Reader Advisory

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

Certain information set forth in this news release contains forward-looking statements or information ("forward-looking statements"), including details about the proposed transaction with AcquisitionCo. By their nature, forward-looking statements are subject to numerous risks and uncertainties, some of which are beyond the Corporation's control, including the impact of general economic conditions, industry conditions, volatility of commodity prices, currency fluctuations, environmental risks, operational risks, competition from other industry participants, stock market volatility, the risks that the parties will not proceed with the acquisition of AcquisitionCo, that the ultimate terms of the acquisition will differ from those that currently are contemplated and the ability to access sufficient capital from internal and external sources. Although the Corporation believes that the expectations in its forward-looking statements are reasonable, its forward-looking statements have been based on factors and assumptions concerning future events which may prove to be inaccurate. Those factors and assumptions are based upon currently available information. Such statements are subject to known and unknown risks, uncertainties and other factors that could influence actual results or events and cause actual results or events to differ materially from those stated, anticipated or implied in the forward-looking statements. Accordingly, readers are cautioned not to place undue reliance on the forward-looking statements, as no assurance can be provided as to future results, levels of activity or achievements. Risks, uncertainties, material assumptions and other factors that could affect actual results are discussed in our public disclosure documents available at www.sedar.com. Furthermore, the forward-looking statements contained in this document are made as of the date of this document and, except as required by applicable law, the Corporation does not undertake any obligation to publicly update or to revise any of the included forward-looking statements, whether as a result of new information, future events or otherwise. The forward-looking statements contained in this document are expressly qualified by this cautionary statement.

This news release is not an offer of securities for sale in the United States. Securities may not be offered or sold in the United States or to or for the account or benefit of U.S. persons (as such terms are defined in Regulation S under the United States Securities Act of 1933, as amended (the "U.S. Securities Act")), absent registration or an exemption from registration. The securities offered have not been and will not be registered under the U.S. Securities Act or any state securities laws and, therefore, may not be offered for sale in the United States, except in transactions exempt from registration under the U.S. Securities Act and applicable state securities laws.

For further information on please contact:

Dave Antony                                      
Blackhawk -Chief Executive Officer                        
403-531-1710                                                          
[email protected]

Fred Pels
The Green Room
780-901-3733
[email protected]

SOURCE Blackhawk Resource Corp.