Blue Parrot Energy Inc.
TSX VENTURE : BPA

Blue Parrot Energy Inc.

March 27, 2009 19:08 ET

Blue Parrot Energy Inc. Announces Asset Acquisition, Flow-Through Placement, Change of Auditor and AGM Matters

CALGARY, ALBERTA--(Marketwire - March 27, 2009) -

NOT FOR DISTRIBUTION TO UNITED STATES NEWSWIRE SERVICES OR FOR DISSEMINATION IN THE UNITED STATES.

Blue Parrot Energy Inc., (TSX VENTURE:BPA) ("Blue Parrot" or the "Corporation") announces the following:

Asset Acquisition

The Corporation announces that it has entered into a letter of intent to acquire certain royalties on the Corporation's lands from Canadian Phoenix Resources Corp. ("CPH"). The Corporation intends to purchase the royalties recovered from the Corporation's wells in the Bonnie Glenn area which represent a 16% royalty of the gross monthly production (expressed in cubic meters) produced or deemed to be produced (the "Gross Overriding Royalty"). The Corporation intends to purchase the Gross Overriding Royalty for $1,000,000 with an effective date of January 1, 2009 (the "Purchase"). The Corporation will make an initial payment towards the Purchase of $500,000 with a second payment of $250,000 (plus interest) due June 30, 2009 and a final payment of $250,000 (plus interest) due December 31, 2009. At the time of closing, the Corporation has agreed to provide CPH with a secured note for $500,000 (the "Note"), which is subordinate to the Corporation's primary lender. The Corporation has an option to repay the Note at anytime without penalty.

Private Placement

The Corporation also announces that it has completed a $247,000 non-brokered private placement of common shares to be issued on a flow-through basis ("Flow-Through Shares") for income tax purposes at $0.05 per share (the "Placement"). An Insider of the Corporation has subscribed for over 25% of the Placement. The proceeds of the Placement shall be used to finance exploration and development activities, which qualify as Canadian Exploration Expenses ("CEE") under the Income Tax Act (Canada). The Corporation will be required to incur qualifying CEE totaling $247,000 by December 31, 2010 and will renounce this amount of CEE to subscribers effective December 31, 2009. The securities issued will be subject to a four-month hold period from the date of closing.

Change of Auditor

The former auditor of the Corporation, Buchanan Barry LLP, resigned as auditor of the Corporation on February 2, 2009. Deloitte & Touche LLP was appointed auditor of the Corporation effective February 3, 2009 by the Board of Directors, subject to shareholder ratification at the Corporation's upcoming Annual and Special Meeting of Shareholders.

Annual and Special Meeting of Shareholders

The Corporation also announces it will be proposing a number of special matters for consideration and approval at its upcoming Annual and Special Meeting of Shareholders (the "Meeting") to be held on May 8, 2009 as follows:

Common Share Consolidation and Name Change

The Corporation is proposing a consolidation (the "Share Consolidation") of its issued and outstanding common shares (the "Common Shares") on the basis of one (1) new common share for every twenty (20) Common Shares issued and outstanding (the "New Common Shares"). Currently there are 148,157,143 Common Shares of the Corporation issued and outstanding. On a post-consolidated basis, the Corporation anticipates that there will be a total of 7,407,857 New Common Shares of the Corporation issued and outstanding.

No fractional New Common Shares will be issued as a result of the Share Consolidation. If, as a result of the Share Consolidation, the holder of New Common Shares would otherwise be entitled to a fraction of a share, the number of New Common Shares issuable to such shareholder shall be rounded up in the event the said shareholder was entitled to a fractional share equivalent to one-half or more of a New Common Share and shall be rounded down in the event the said shareholder was entitled to a fractional share equivalent to less than one-half of a New Common Share.

In connection with the Share Consolidation, the Corporation is proposing a name change and a new stock trading symbol.

Under the policies of the TSX Venture Exchange, the purchase price for private placements of the Common Shares must not be less than $0.05 per Common Share. At current trading prices the Corporation may be unable to raise additional capital through the issuance of Common Shares and comply with the TSX Venture Exchange policies. The intention of the Share Consolidation is to increase the trading price of the Common Shares so that the Corporation may raise additional capital. There can be no assurances however that the market price of the New Common Shares will increase as a result of the Share Consolidation. The Board of Directors believes that the Share Consolidation should lead to increased interest by a wider audience of potential investors resulting in a more efficient market for the New Common Shares.

Cautionary Statements

Completion of the Share Consolidation and name change contemplated herein are subject to a number of conditions, including but not limited to, TSX Venture Exchange acceptance, shareholder approval and the ability of the Corporation to maintain its Tier Maintenance Requirements post consolidation.

There can be no assurance that the transactions will be completed as proposed, or at all.

Investors are cautioned that, except as disclosed in the management information circular prepared in connection with the transactions, any information released or received with respect to the transactions may not be accurate or complete and should not be relied upon. Trading in the securities of Blue Parrot should be considered highly speculative.

Blue Parrot is a Calgary based oil and natural gas exploration, development and production company.

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

Contact Information

  • Blue Parrot Energy Inc.
    Paul Patton
    Chief Operating Officer
    (403) 262-8444