Pursuant to the MOU, a wholly-owned subsidiary of the Company will merge with and into Li3. Li3's shareholders will receive in the transaction one ordinary share of Blue Wolf for every 250 Li3 shares they own. Blue Wolf intends to negotiate and execute a definitive agreement with Li3 in accordance with the terms of the MOU. Blue Wolf's sponsor, Blue Wolf MHC Ltd. (the "Sponsor"), will forfeit 80% of its founder shares and 80% of its warrants upon the closing of the proposed transaction .

This says that Blue Wolf will be reverse split, and not Li3.  However, Blue Wolf management is not recommending that investors in their company accept this offer.  Instead, Blue Wolf recommends that shareholders hold out, or wait, for a second offer.