Newstrike Resources Ltd. and HPI Holdings Ltd. Complete Business Combination - Seite 2

"Closing this Transaction expands and accelerates our growth strategy in the best possible ways," said Jay Wilgar, incoming CEO of Newstrike and founder of HPI. "We emerge at an extraordinary time: the dawn of a new consumer category and all the related opportunities that it presents. We also emerge with the best possible team, possessing the right expertise, and supported by a very strong shareholder base with a track record of investing in some of the most successful companies in the emerging cannabis sector. I look forward to continuing to realize on the opportunities that are presented and building value for our shareholders in doing so," added Wilgar.

The Transaction

In connection with the completion of the Transaction, Newstrike completed a non-brokered private placement of 25,000,000 subscription receipts ("Subscription Receipts") on March 7, 2017 at a price of $0.125 per Subscription Receipt to raise aggregate gross proceeds of $3,125,000 (the "Subscription Receipt Financing"). In connection with the closing of the Transaction, each Subscription Receipt automatically converted into one Newstrike Share without any further consideration on the part of the purchasers, and the gross proceeds from the Subscription Receipt Financing were released to Newstrike from escrow. The majority of the Newstrike Shares underlying the Subscription Receipts are subject to a voluntary escrow period commencing on the date of issuance thereof until the later of (i) September 30, 2017 (being the date that is four months and a day following the closing date of the Transaction); and (ii) such longer period as may be imposed by the applicable stock exchange, all in accordance with the terms and conditions thereof.

Also in connection with the completion of the Transaction, HPI completed a non-brokered private placement (the "Debenture Financing") of unsecured, non-interest bearing convertible debentures (the "Debentures") in the aggregate principal amount of Cdn$1,500,000. The Debentures entitled the holders thereof to acquire 1.13 common shares of HPI (each one such common share, an "Underlying HPI Share") for each Cdn$1.00 in principal amount thereof, and were automatically converted into Underlying HPI Shares, without any further action or formality on the part of the holders thereof, immediately prior to the completion of the Transaction. The Underlying HPI Shares are subject to a voluntary escrow period commencing on the date of issuance thereof until the later of (i) September 30, 2017 (being the date that is four months and a day following the closing date of the Transaction); and (ii) such longer period as may be imposed by the applicable stock exchange, all in accordance with the terms and conditions thereof.