Mr. Leonard Van Betuw reports

QUATTRO AGREES TO PURCHASE SRD INNOVATIONS INC. FOR $3,500,800 THROUGH THE ISSUANCE OF PREFERRED CLASS C SHARES

Quattro Exploration and Production Ltd. has signed a binding letter of intent to purchase all the shares of SRD Innovations Inc., an Alberta-based wireless technology company focused on the collection of real-time seismic imaging for exploration, reservoir engineering and microseismic for hydraulic fracture monitoring, mapping and analysis, including all contracts, licensing revenues, patents, technologies and continuing research.

Quattro intends to purchase all of the shares of SRD through the issuance of 35,008 Class C, Series 3, preferred shares of Quattro valued at $100 per share. The shareholders of SRD, by way of a share exchange, shall receive one preferred share in exchange for 69.6563 Class A common shares of SRD, valuing SRD's Class A common shares at $1.42 per share (subject to revision on closing). Closing of the purchase is scheduled on or before Dec. 28, 2015, and is subject to a number of customary conditions, including, but not limited to, approval of the TSX Venture Exchange.

Further to the share exchange, and independent of the benefits associated with the preferred shares, SRD shareholders, on a pro rata basis, shall be individually entitled to a quarterly distribution of 75 per cent (net of taxes but before expenses) of all future licensing revenues associated with the wireless technology developed by SRD as a wholly owned subsidiary of Quattro, including future software revisions and developments.

The preferred shares are priced at $100 per share, paying an annual preferred dividend of $3.50 per share. The holder will have the right on the anniversary of the second year of issuance to convert the preferred shares into Class A common shares at a ratio of 40 Class A shares for each preferred share converted, valuing the Class A common shares at a deemed price $2.50 per share. Closing is subject to final TSX Venture Exchange approval.

The background

"The acquisition of SRD Innovations Inc. remains consistent with Quattro's mission statement of being a competitive, environmentally responsible supplier of energy," said Leonard Van Betuw, president and chief executive officer of Quattro. "SRD has been a known asset to Quattro for many years. A powerhouse of intellectual personal and capacity, recognized by a far-reaching array of their peers, including the IEEE Standards Association, the National Science and Engineering Research Council, and the Alberta Research Council. Quattro's interest in SRD has been as a passive supporter for the past five years. Their skills as innovators are boundless, ranging from the foundations of cellular wireless standards and Wi-Fi in the 1990s to development of the stable power systems required for what is now commonly known as the MIR.

"Quattro's interest in SRD Innovations developed into over two years ago, as SRD's patent portfolio and research resulted in their first commercialized application, the hyMesh wireless solution, developed for the collection of real-time seismic imaging for exploration, reservoir engineering and microseismic for hydraulic fracture monitoring, mapping and analysis. This innovative solution is now quickly migrating, as all proven technologies do, into a vast arena of needs, including wireless communications, voice and video. Applications range from private and secure wireless communications and data networks to collecting data from remote industrial work sites, to monitoring pipelines, to wireless video monitoring.

"Quattro commenced negotiations with SRD Innovations Inc. in 2014 for the application of SRD's technologies in the areas of focus Quattro thought were a priority, only to realize that we were competing with a growing monster. Just a few competing industries were wireless communication networks, agri-tech, industrial asset management, autonomous equipment control and video data streaming.

"After 18 months of contract negotiations, and the development of a strong appreciation of SRD's technological applications, potential and challenges, it became apparent that buying the company, participating in the growing licensing revenues, and gaining control over the SRD's technology in the areas of resources exploration and development was not only the best solution for the low-cost implementation and the continuing application of the technology for Quattro's needs, but it had the potential to be a very accretive investment opportunity."

Summary of the acquisition

Market:  wireless networks, monitoring and secure data transmission

Purchase price:  $3,500,800 of Class C, Series 3, preferred shares priced at $100 each

Business:  wireless communications, 100 per cent of hardware sales and 25 per cent (net) of licensing revenues

Employees:  two employees, plus consultants growing to 12 in five years (estimated)

Assets:  patents, inventory, research laboratories and office equipment

Potential:  sales of more than $100-million per year by 2020

Quattro anticipates annual savings due to the illumination of alternative services through the application and implementation of SRD's technology starting in 2016 will result in a savings of approximately $500,000 per year in the next five years at current production levels and sheltering the company from additional costs of $8-million in costs, over the same five years based on the company's exploration and production plans from 2016 to 2020.

We seek Safe Harbor.