HPI Holdings Ltd. signed an agreement to acquire Newstrike Resources Ltd. (TSXV:NR) in a reverse merger transaction on February 3, 2017. Under the terms, all of the issued and outstanding HPI shares, other than the underlying HPI shares, shall be exchanged for 269 million Newstrike's shares to be distributed proportionately amongst the HPI shareholders. In addition, the debentures will be converted by HPI into a maximum of 1.7 million underlying HPI shares and each underlying HPI share will be converted into approximately 7.077 Newstrike shares resulting in the issuance of up to approximately 12 million Newstrike shares and an aggregate of up to approximately 16 million Newstrike shares will be reserved for issuance upon exercise of the HPI warrants, with each such HPI warrant entitling the holder to acquire approximately 7.077 Newstrike shares in lieu of one HPI share, at an exercise price of CAD 0.125 per Newstrike share. Upon closing, the current holders of Newstrike will hold approximately 13.2% of the outstanding Newstrike shares and the holders of the HPI shares will collectively hold approximately 79.7% of the outstanding Newstrike's shares. 2497895 Ontario Inc., wholly-owned subsidiary of HPI, will hold approximately 29.57% of all issued and outstanding Newstrike shares. In connection with the transaction, Newstrike proposes to complete a non-brokered private placement of up to 25 million subscription receipts at a price of CAD 0.125 per subscription receipt to raise aggregate gross proceeds of up to CAD 3.125 million. HPI also proposes to complete a non-brokered private placement of unsecured, non-interest bearing convertible debentures in the aggregate principal amount of up to CAD 1.5 million. Upon closing, the Board of the Newstrike will be reconstituted to be comprised of five members, two of which will be nominees of Newstrike and three will be nominees of HPI. In addition, all current officers of Newstrike shall resign and be replaced by nominees of HPI. Jay Wilgar will serve as Chief Executive Officer and Director, Scott Kelly, Peter Hwang, Nik Van Haeren and Liam Scott will serve as Directors of Newstrike. The Directors and officers of 2497895 Ontario Inc. will consist of Nik Van Haeren and Jeff Van Haeren. The transaction is subject to the acceptance by the TSXV, holders of not less than 80% of the existing share purchase warrants of Newstrike delivered irrevocable agreements that such securities shall be exercised on or prior to the later of June 30, 2017 or the date which is 60 days following February 3, 2017, Newstrike shall have divested all mining assets and wound-up or dissolve Newstrike Wyoming Inc, Newstrike shall have cash on hand of at least CAD 0.8 million, existing shareholders agreement of HPI will be terminated, approval by atleast 66 2/3% of shareholder of HPI, approval of shareholders of Newstrike, execution of employment or consulting agreements, all applicable HPI shareholders shall have entered into the requisite escrow agreements, all applicable HPI shareholders shall have entered into the requisite escrow agreements, Newstrike shall have received lock-up agreements executed by the holders of all HPI warrants and completion of the subscription receipt financing and the debenture financing. AltraCorp Capital Inc. has been retained to act as the sponsor in connection with the transaction. TSX Trust Company acted as transfer agent in the transaction. The transaction is expected to close on May 26, 2017.