UTS Energy Announces A Plan Of Arrangement With Total E&P Canada

IRJ July 8 - Calgary, Alberta, Canada – UTS Energy Corporation (“UTS” or the “Company”) is pleased to announce that its Board of Directors has unanimously approved a Plan of Arrangement (the “Plan”) whereby Total E&P Canada Ltd. (“Total”) will acquire all of the issued and outstanding common shares of UTS and, pursuant to the Plan, shareholders of UTS will receive cash consideration of $1.5 billion or $3.08 per UTS share (the “Cash Consideration”) and shares in a new, publicly-traded exploration and development company, SilverBirch Energy Corporation (“SilverBirch”).

The Cash Consideration to be received by UTS shareholders represents a 46% premium to UTS’ closing price on July 6, 2010 of $2.11 per UTS share and a 36% premium to UTS’ 30-day volume weighted-average trading price of $2.26 per UTS share. UTS shareholders will also receive shares in SilverBirch whose assets will include a 50% interest in both the Frontier and Equinox Projects, interests in exploration oil sands leases and undeveloped lands as well as approximately $50 million in working capital (subject to adjustment). Upon completion of the transaction (which includes a planned 10:1 consolidation of SilverBirch shares), UTS’ existing shareholders will own 100% of the SilverBirch shares outstanding.

As a result, the full proceeds that UTS shareholders will receive under the Plan include:  Cash Consideration of $3.08 per UTS share  Proportionate ownership in SilverBirch representing approximately $0.10 of working capital and 1.8 bbls of Contingent Resources (Best Estimate) per UTS share “This transaction allows UTS shareholders to realize an immediate cash premium to UTS’ current share price while also participating in the significant growth potential of SilverBirch”, said John Watson, Chair of the UTS Board of Directors.

The Board of Directors of UTS, after receiving the recommendation of the Special Committee and fairness opinions from its financial advisors, has unanimously approved the Plan and recommends that UTS shareholders vote in favour of it. In addition, UTS’ major shareholder (West Face Capital), management and directors, who collectively own approximately 15% ofUTS’ diluted shares outstanding, have signed agreements in support of the transaction.