Poplar Creek Resources Inc.

July 20, 2009 06:30 ET

Poplar Creek Resources Inc. Announces Closing of Acquisition, Financing and Corporate Reorganization

CALGARY, ALBERTA--(Marketwire - July 20, 2009) -


Poplar Creek Resources Inc. (the "Corporation") (TSX VENTURE:PCK), "PCK" on the TSX Venture Exchange (the "Exchange"), announces further to the news release of June 29, 2009, that it has closed an arm's length acquisition of 3.5% of the petroleum and natural gas assets of Twoco Petroleums Ltd. ("Twoco") for a cash consideration of $1,925,000 plus adjustments and GST on tangibles, totaling $1,955,487.76, and has entered into a Farm-in Agreement with Twoco where Twoco will drill 2 wells at its cost and risk to earn 50% of Poplar's working interest on each section drilled.

The Corporation has the option to purchase additional tranches of 4% of Twoco's assets up to a total of 19.5% on various dates up to December 1, 2009, at a total further consideration of $8.8 million. The Corporation intends to raise funds through further equity financings.

The Corporation also announces the closing of a non-brokered unit offering (the "Unit Offering") of 6,515,000 units ("Units") at $0.10 each raising a gross amount of $ 651,500. Each Unit is comprised of one common share and a half of a warrant where each whole warrant ("Warrant Series "A") entitles the holder to purchase a common share of the Corporation at any time up to July 15, 2012, at a price of $0.20. The Warrants Series "A" are subject to a call provision where at any time after six months from the date of issuance, if the common shares trade on the Exchange at $0.40 or more for 20 consecutive trading days, the Corporation may, on 30 days notice, call the holders to exercise their Warrants Series "A" and if not exercised such Warrants Series "A" expire. Commissions of 7% were paid to brokers in the amount of $13,510. Directors and officers and their related parties participated in the Unit Offering. Unsecured loans were also received from George Watson as to $100,000 and John Carruthers as to $25,000.

The Corporation now has 20,349,000 issued common shares. The 6,515,000 common shares issued as part of the Unit Offering and all of the 3,257,500 common shares are issuable on exercise of the Warrants Series "A" are subject to a hold period of 4 months and one day (to November 16, 2009) pursuant to securities commission and Exchange requirements.

The Corporation also paid a finders fee of $100,000 and has issued 3 million non-transferable Warrants Series "B" to John Carruthers and Richard Edgar entitling them to purchase up to 3 million common shares of the Corporation at $0.20 each until July 15, 2012. The Warrants Series "B" are subject to a Contractual Escrow Agreement whereby the Warrants Series "B" can be exercised as to one million at this time, one million when the EBITDA reaches $0.024 per share and the last million when the Corporation's production reaches 300 boepd; if the Warrants Series "B" are not released or exercised by July 15, 2012, they expire. Shares issued on exercise of the Warrants Series "B" will have a hold period until November 16, 2009. It is not expected that the Warrants Series "B" will be exercised by that date.

The Corporation also announces that Donald G. J. Dutton has resigned as director, CEO and President and James Decker and Barry Davies have resigned as directors of the Corporation. John Carruthers has been appointed a director and CEO and Richard Edgar has been appointed as director and President. The board is now comprised of John Carruthers, CEO, Richard Edgar, President, George Watson, Lee Nichols and Gregory R. Harris. George Watson has been appointed Chairman of the Board.

The Corporation acknowledges the contributions of Messrs. Donald G. J. Dutton, James Decker and Barry Davies who were founding shareholders and directors and is pleased to announce that they have agreed to act as consultants to the Corporation until December 31, 2010.

The above transactions have received Exchange conditional approval and final approval will be granted upon the Corporation providing some further documentation.

For more information on Poplar Creek Resources Inc., investors should review the Corporation's filings which are available at www.sedar.com.

This release includes certain statements that may be deemed "forward looking statements". More particularly, this news release contains statements concerning completion of the proposed Transaction, drilling plans, capital programs, debt and funds flow from operations. All statements in this release, other than statements of historical facts, which address future activities including the closing of the Transaction or the private placement, exploration drilling and activity, reserves potential, and events or developments that the Corporation intends, plans, anticipates, believes, estimates or expects are forward looking statements. Actual results may differ materially. Although the Corporation believes such forward looking statements are based on reasonable assumptions, such statements are not guarantees of future performance and actual results or developments may differ materially from those in the forward looking statements. Factors that could cause results to differ materially from those in the forward looking statements include, but are not limited to: market conditions and difficulties of raising funds in this economic environment, availability and costing of exploration contractors; exploration success; continued availability of capital government regulations, laws and charges; environmental developments; exploitation economics; and generally the economic, market, financial and business conditions in the present volatile and uncertain economic period. Investors are cautioned that any statements are not guarantees of future performance and actual results or developments may differ materially from those stated in the forward looking statements. The Company does not intend, and does not assume any obligation to update these forward-looking statements to reflect events or circumstances after the date hereof. More detailed information about potential factors that could affect financial results is included in the documents filed from time to time with the Canadian securities regulatory authorities by Poplar Creek. This news release shall not constitute an offer to sell or the solicitation of any offer to buy securities in any jurisdiction.

Neither the 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

  • Poplar Creek Resources Inc.
    John Carruthers
    (403) 875-1821
    Poplar Creek Resources Inc.
    Richard Edgar
    (403) 616-5387