Red Hill Details the Proposed Spin-Out Company
VANCOUVER,
B.C. - March 19, 2010, : Red
Hill Energy (TSX-V:RH) (the "Company") Red Hill Energy is pleased to
provide the following update on the proposed spin-out company being
created in conjunction with the proposed Red Hill Energy / Prophecy
Resource Corp merger. The Red Hill / Prophecy merger excludes Red Hill's
non-coal assets. As the first step of the proposed plan of arrangement
with Prophecy (the "Arrangement") and prior to the merger of
Red Hill and Prophecy, Red Hill will transfer its non-coal assets and CDN
$1 million to a wholly owned subsidiary called Elissa Resources Ltd.
("Elissa"). Shareholders of Red Hill Energy will (and in
addition to their conversion to Class A common shares on a .92 for 1
basis) be issued shares of Elissa on a conversion basis of 1 for 4
whereby for every four (4) shares of Red Hill Energy held on the
effective date of the Arrangement (the "Effective Date"), Red
Hill shareholders will be issued one (1) share of Elissa Resources Ltd.
At completion, Elissa will have approximately 15,089,969 shares
outstanding. No Red Hill options or warrants will entitle their holders
to receive any shares of Elissa or convertible securities of Elissa,
except to the extent such holder exercises their Red Hill options or
warrants, as the case may be, to acquire shares of Red Hill prior to the
Effective Date. The non-coal properties consist of the 100% owned, Thor
Rare Earth Property, Nevada, the 100% owned Red Lithium Property, Nevada
and the 100% owned Banbury Gold Property, British Columbia.
Elissa
will be initiated as a reporting but unlisted company. Elissa shares will
not be listed on any stock exchange following completion of the
Arrangement, however Elissa intends to apply for a listing on the TSX-V
in due course. There can be no assurances that Elissa will be successful
in listing on any stock exchange. For more detailed information about
Elissa, including information concerning the proposed Board of Directors,
capitalization structure and other information, please see the Joint
Information Circular of Red Hill and Prophecy dated March 15, 2010
available on SEDAR at www.sedar.com
under Prophecy's and Red Hill's profile and/or on either www.redhillenergy.com or www.prophecyresource.com
ABOUT RED HILL ENERGY INC.
Red Hill Energy Inc. is a
junior resource company trading on the TSX-Venture Exchange under the
trading symbol RH. The Company is advancing over one billion tonnes of
100% owned coal from two Mongolian coal basins towards production. Red
Hill has a full-time office in Mongolia's capital, Ulaanbaatar.
Red Hill Energy Inc.
G. Arnold Armstrong - Chairman and CEO
For further information:
Telephone 604.642.COAL (2625)
Email: info@redhillenergy.com
www.redhillenergy.com
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