Sword Energy Inc.

Thunder Energy Trust

Thunder Energy Trust

February 27, 2008 19:28 ET

Sword Energy Inc. Releases 2007 Canadian Income Tax Information for the Former Thunder Energy Trust

The information contained in the press release is based on Sword Energy Inc.'s understanding of the Income Tax Act (Canada) and the regulations thereunder. Unitholders should consult their own tax advisors with respect to their particular circumstances.

CALGARY, ALBERTA--(Marketwire - Feb. 27, 2008) - Sword Energy Inc., a private corporation which acquired Thunder Energy Trust pursuant to the closing of a plan of arrangement on June 26, 2007, today issued the following information, which is intended to assist individual Canadian unitholders of the former Thunder Energy Trust ("Thunder") in the preparation of their 2007 T1 Income Tax Return.

Trust Units Held Within an RRSP, RRIF, RESP or DPSP

No amounts are required to be reported on the 2007 T1 Income Tax Return where the Thunder trust units are held within an RRSP, RRIF, RESP or DPSP.

Trust Units Held Outside of an RRSP, RRIF, RESP or DPSP

Unitholders who held their Thunder trust units outside of an RRSP, RRIF, RESP or DPSP, through a broker or other intermediary and received cash distributions during the period, will receive "T3 Supplementary" slips directly from their broker or intermediary, not from the transfer agent of Thunder. Registered unitholders of Thunder trust units who received cash distributions during the period from the transfer agent, Olympia Trust Company, (and not from a broker or intermediary), will receive "T3 Supplementary" slips directly from Olympia Trust Company.

Under Paragraph 12(1)(m) of the Canadian Income Tax Act, taxable amounts allocated by Thunder in 2007 to the unitholders must be reported by the unitholders in their 2007 Income Tax Return.

The taxable amount of distributions (i.e. "Other Income" Box (26) on the T3 slips) with respect to record dates from January 1, 2007 up to and including June 26, 2007 will be included in your "T3 Supplementary".

Holders of Thunder trust units who received distributions are required to reduce the Adjusted Cost Base of their units to the extent the distributions constituted a return of capital. The reduction is equal to the cumulative distributions minus cumulative taxable amounts reported as "Other Income" Box (26) on their T3 slips. This amount will be included in Box (42) in your "T3 Supplementary".

The Adjusted Cost Base is used in calculating capital gains or losses on the disposition of the trust units where the owner holds the trust units as a capital property.

The attached "Schedule 1" includes supplementary information on the approximate taxable portion and the approximate tax deferred portion of the 2007 distributions, shown on a per unit basis.



Schedule 1:

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Thunder Energy Trust
2007 - T3 Information for Canadian Residents

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Total Taxable Amount Tax Deferred Amount
Record Payment Distribution (Box 26) (Box 42) Return of
Date Date Paid Other Income Capital Amount
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January 22, February 15,
2007 2007 $ 0.12 0.11736 0.00264
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February 22, March 15,
2007 2007 $ 0.09 0.08802 0.00198
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March 22, April 16,
2007 2007 $ 0.09 0.08802 0.00198
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April 23, May 15,
2007 2007 $ 0.09 0.08802 0.00198
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May 23, June 15,
2007 2007 $ 0.09 0.08802 0.00198
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Total Per Unit $ 0.48 0.46944 0.01056
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Contact Information

  • Sword Energy Inc.
    Pamela Kazeil
    Vice President, Finance
    (403) 294-1635
    (403) 232-1317 (FAX)